{"ok":true,"canonical_url":"https://dealroom.so/glossary/key-principals","api_url":"https://dealroom.so/api/public/glossary/key-principals","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"key-principals","term":"Key Principals","group":"People and paperwork","definition":"Individuals who own 20% or more of the business, or those with significant management responsibilities. These are the people the SBA will scrutinize for loan eligibility and guarantees.","what_it_means":"All key principals must provide personal financial statements, tax returns, and undergo credit checks. They will also be required to personally guarantee the SBA loan. Ensure all individuals meeting this definition are identified early, as their background, creditworthiness, and financial health are critical to loan approval and closing the deal.","url":"https://dealroom.so/glossary/key-principals","official_sources":[{"slug":"sba-form-1919","title":"SBA Form 1919 — Borrower Information Form","official_url":"https://www.sba.gov/document/sba-form-1919-borrower-information-form","official_label":"View on SBA.gov","authority_tier":4,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sba-form-1919"},{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"personal-guarantee","term":"Personal guarantee","url":"https://dealroom.so/glossary/personal-guarantee"},{"slug":"personal-financial-statement","term":"Personal financial statement","url":"https://dealroom.so/glossary/personal-financial-statement"},{"slug":"social-security-number","term":"Social Security Number","url":"https://dealroom.so/glossary/social-security-number"},{"slug":"form-1919","term":"Form 1919","url":"https://dealroom.so/glossary/form-1919"}],"related_questions":[{"question":"When is life insurance on key principals a mandatory loan condition?","url":"https://dealroom.so/for-lenders/questions/when-is-life-insurance-on-key-principals-a-mandatory-loan-condition"},{"question":"When is life insurance required on key principals for an SBA 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/when-is-life-insurance-required-on-key-principals-for-an-sba-7-a-loan"},{"question":"What are the specific requirements for life insurance collateral assignment when multiple key principals exist?","url":"https://dealroom.so/for-lenders/questions/what-are-the-specific-requirements-for-life-insurance-collateral-assignment-when-multiple-"},{"question":"How does a lender ensure proper collateral assignment of life insurance on multiple key principals?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-ensure-proper-collateral-assignment-of-life-insurance-on-multiple-key-pr"},{"question":"When is life insurance on key principals absolutely required for an SBA 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/when-is-life-insurance-on-key-principals-absolutely-required-for-an-sba-7-a-loan"},{"question":"When is life insurance collateral assignment required for key principals in an acquisition, and for whom?","url":"https://dealroom.so/sba-7a/questions/when-is-life-insurance-collateral-assignment-required-for-key-principals-in-an-acquisition"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Key Principals","url":"https://dealroom.so/glossary/key-principals","source_type":"DealRoom Data"}}