{"ok":true,"canonical_url":"https://dealroom.so/glossary/liquidate","api_url":"https://dealroom.so/api/public/glossary/liquidate","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":"liquidate","term":"Liquidate","group":"Doing the deal","definition":"To liquidate means to sell off assets to convert them into cash, often to pay off debts. Buyers care because in a worst-case scenario, if the business fails, collateral assets would be liquidated to repay your SBA loan.","what_it_means":"The SBA and your lender will assess the liquidation value of collateral pledged for your loan. While you're focused on success, understanding the lender's recourse in a default scenario is crucial. A liquidation plan is prepared if a loan defaults, outlining how assets will be sold to recover funds.","url":"https://dealroom.so/glossary/liquidate","official_sources":[{"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":"collateral","term":"Collateral","url":"https://dealroom.so/glossary/collateral"},{"slug":"liquidation-value","term":"Liquidation Value","url":"https://dealroom.so/glossary/liquidation-value"},{"slug":"loan-default","term":"Loan default","url":"https://dealroom.so/glossary/loan-default"},{"slug":"recourse","term":"Recourse","url":"https://dealroom.so/glossary/recourse"}],"related_questions":[{"question":"How does a lender process a Universal Purchase Package (UPP) when collateral is still being liquidated?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-process-a-universal-purchase-package-upp-when-collateral-is-still-being-"},{"question":"What is the primary purpose of SBA Form 1149 in the guaranty purchase process for a liquidated 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/what-is-the-primary-purpose-of-sba-form-1149-in-the-guaranty-purchase-process-for-a-liquid"}]},"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 — Liquidate","url":"https://dealroom.so/glossary/liquidate","source_type":"DealRoom Data"}}