{"ok":true,"canonical_url":"https://dealroom.so/glossary/liquidity","api_url":"https://dealroom.so/api/public/glossary/liquidity","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":"liquidity","term":"Liquidity","group":"Reading the business","definition":"The ease with which an asset can be converted into cash without affecting its market price. For a business, it refers to its ability to meet short-term obligations.","what_it_means":"Lenders assess both the business's liquidity and your personal liquidity. The business needs enough cash and current assets to cover operating expenses, especially during a transition. Your personal liquidity demonstrates your ability to cover unexpected costs or personal expenses if the business underperforms initially. Be ready to provide bank and brokerage statements.","url":"https://dealroom.so/glossary/liquidity","official_sources":[],"related":[{"slug":"working-capital","term":"Working capital","url":"https://dealroom.so/glossary/working-capital"},{"slug":"personal-financial-statement","term":"Personal financial statement","url":"https://dealroom.so/glossary/personal-financial-statement"},{"slug":"bank-statement","term":"Bank Statement","url":"https://dealroom.so/glossary/bank-statement"},{"slug":"brokerage-statement","term":"Brokerage Statement","url":"https://dealroom.so/glossary/brokerage-statement"}],"related_questions":[{"question":"How does a lender evaluate my personal liquidity for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/how-does-a-lender-evaluate-my-personal-liquidity-for-an-sba-7-a-loan"},{"question":"What if my personal liquidity is low, but the business's financials are very strong?","url":"https://dealroom.so/sba-7a/questions/what-if-my-personal-liquidity-is-low-but-the-business-s-financials-are-very-strong"},{"question":"How does a lender verify the liquidity of an equity injection from a borrower's investment account?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-the-liquidity-of-an-equity-injection-from-a-borrower-s-investment"},{"question":"What if my personal financial statement shows low liquidity, but I have a strong credit score and business plan?","url":"https://dealroom.so/sba-7a/questions/what-if-my-personal-financial-statement-shows-low-liquidity-but-i-have-a-strong-credit-sco"},{"question":"What happens if my personal financial statement shows low liquidity, but I have a strong credit score and business plan?","url":"https://dealroom.so/sba-7a/questions/what-happens-if-my-personal-financial-statement-shows-low-liquidity-but-i-have-a-strong-cr"},{"question":"What if my personal liquidity is low, but I have a substantial amount in my 401k that I can borrow against?","url":"https://dealroom.so/sba-7a/questions/what-if-my-personal-liquidity-is-low-but-i-have-a-substantial-amount-in-my-401k-that-i-can"}]},"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 — Liquidity","url":"https://dealroom.so/glossary/liquidity","source_type":"DealRoom Data"}}