{"ok":true,"canonical_url":"https://dealroom.so/glossary/liabilities","api_url":"https://dealroom.so/api/public/glossary/liabilities","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":"liabilities","term":"Liabilities","group":"Reading the business","definition":"These are the financial obligations or debts a business owes to others, like accounts payable or existing loans. Buyers must identify and understand all liabilities to assess the true financial health of the business.","what_it_means":"During due diligence, you'll scrutinize the business's balance sheet for all existing liabilities. In an asset purchase, you typically assume only specific, agreed-upon liabilities, while in a stock purchase, you assume all of them. Hidden liabilities are a major risk, so your due diligence and legal review are critical to protect you.","url":"https://dealroom.so/glossary/liabilities","official_sources":[],"related":[{"slug":"balance-sheet","term":"Balance Sheet","url":"https://dealroom.so/glossary/balance-sheet"},{"slug":"due-diligence","term":"Due diligence","url":"https://dealroom.so/glossary/due-diligence"},{"slug":"asset-purchase","term":"Asset purchase","url":"https://dealroom.so/glossary/asset-purchase"},{"slug":"stock-purchase","term":"Stock purchase","url":"https://dealroom.so/glossary/stock-purchase"}],"related_questions":[{"question":"What happens if the business being acquired has significant outstanding tax liabilities at closing?","url":"https://dealroom.so/for-lenders/questions/what-happens-if-the-business-being-acquired-has-significant-outstanding-tax-liabilities-at"},{"question":"What if the business I want to acquire has undisclosed liabilities discovered during due diligence?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-want-to-acquire-has-undisclosed-liabilities-discovered-during-due-d"},{"question":"Does finding significant undisclosed liabilities during due diligence kill an SBA 7(a) acquisition loan?","url":"https://dealroom.so/sba-7a/questions/does-finding-significant-undisclosed-liabilities-during-due-diligence-kill-an-sba-7-a-acqu"},{"question":"If multiple owners each guarantee the loan, are their liabilities typically joint and several or individual?","url":"https://dealroom.so/sba-7a/questions/if-multiple-owners-each-guarantee-the-loan-are-their-liabilities-typically-joint-and-sever"},{"question":"Can unreported tax liabilities discovered during due diligence from the seller's business kill my acquisition loan?","url":"https://dealroom.so/sba-7a/questions/can-unreported-tax-liabilities-discovered-during-due-diligence-from-the-seller-s-business-"},{"question":"Can I purchase a business with an SBA 7(a) loan if it has significant environmental liabilities?","url":"https://dealroom.so/sba-7a/questions/can-i-purchase-a-business-with-an-sba-7-a-loan-if-it-has-significant-environmental-liabili"}]},"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 — Liabilities","url":"https://dealroom.so/glossary/liabilities","source_type":"DealRoom Data"}}