{"ok":true,"canonical_url":"https://dealroom.so/glossary/liquidation-plan","api_url":"https://dealroom.so/api/public/glossary/liquidation-plan","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":"liquidation-plan","term":"Liquidation Plan","group":"Doing the deal","definition":"This is a detailed strategy developed by the lender and SBA for recovering funds if a loan defaults. It outlines how assets will be sold to repay the outstanding debt.","what_it_means":"While you're focused on buying and growing, lenders and the SBA have a liquidation plan in mind from day one. It identifies all collateral and personal guarantees that could be called upon if the business fails. Understand your personal exposure and the collateral pledged if things go south.","url":"https://dealroom.so/glossary/liquidation-plan","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"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"loan-default","term":"Loan default","url":"https://dealroom.so/glossary/loan-default"},{"slug":"collateral","term":"Collateral","url":"https://dealroom.so/glossary/collateral"},{"slug":"personal-guarantee","term":"Personal guarantee","url":"https://dealroom.so/glossary/personal-guarantee"},{"slug":"recourse","term":"Recourse","url":"https://dealroom.so/glossary/recourse"}],"related_questions":[{"question":"What is the required timeframe for a lender to submit a liquidation plan?","url":"https://dealroom.so/for-lenders/questions/what-is-the-required-timeframe-for-a-lender-to-submit-a-liquidation-plan"},{"question":"What specific documentation must a lender include in a liquidation plan submitted to the SBA?","url":"https://dealroom.so/for-lenders/questions/what-specific-documentation-must-a-lender-include-in-a-liquidation-plan-submitted-to-the-s"},{"question":"What minimum collection efforts must a lender demonstrate before submitting a 7(a) liquidation plan?","url":"https://dealroom.so/for-lenders/questions/what-minimum-collection-efforts-must-a-lender-demonstrate-before-submitting-a-7-a-liquidat"},{"question":"What is the role of a \"workout plan\" in the liquidation of a defaulted 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/what-is-the-role-of-a-workout-plan-in-the-liquidation-of-a-defaulted-7-a-loan"},{"question":"What are the critical elements a lender must include in the initial liquidation plan submitted to the SBA?","url":"https://dealroom.so/for-lenders/questions/what-are-the-critical-elements-a-lender-must-include-in-the-initial-liquidation-plan-submi"},{"question":"What is the maximum timeframe for a lender to submit a liquidation plan for a defaulted 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/what-is-the-maximum-timeframe-for-a-lender-to-submit-a-liquidation-plan-for-a-defaulted-7-"}]},"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 — Liquidation Plan","url":"https://dealroom.so/glossary/liquidation-plan","source_type":"DealRoom Data"}}