{"ok":true,"canonical_url":"https://dealroom.so/glossary/partial-standby-agreement","api_url":"https://dealroom.so/api/public/glossary/partial-standby-agreement","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":"partial-standby-agreement","term":"Partial Standby Agreement","group":"Your money in the deal","definition":"This agreement allows a seller or other subordinated creditor to receive interest payments, but no principal payments, until the SBA loan is repaid. It's a less restrictive form of standby than a full standby.","what_it_means":"For seller notes counting as equity, the SBA might allow a partial standby if certain conditions are met, letting the seller collect interest. This can make the deal more attractive to a seller than a full standby. Your lender will guide you on the specific requirements.","url":"https://dealroom.so/glossary/partial-standby-agreement","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":"full-standby-agreement","term":"Full Standby Agreement","url":"https://dealroom.so/glossary/full-standby-agreement"},{"slug":"subordinated-debt","term":"Subordinated Debt","url":"https://dealroom.so/glossary/subordinated-debt"},{"slug":"seller-note","term":"Seller note","url":"https://dealroom.so/glossary/seller-note"},{"slug":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"}],"related_questions":[{"question":"Can a partial standby seller note include a provision for interest payments during the standby period?","url":"https://dealroom.so/for-lenders/questions/can-a-partial-standby-seller-note-include-a-provision-for-interest-payments-during-the-sta"},{"question":"How does partial standby treatment affect a seller's note for eligibility?","url":"https://dealroom.so/for-lenders/questions/how-does-partial-standby-treatment-affect-a-seller-s-note-for-eligibility"},{"question":"Can a seller note on partial standby count towards the required equity injection?","url":"https://dealroom.so/sba-7a/questions/can-a-seller-note-on-partial-standby-count-towards-the-required-equity-injection"},{"question":"How does a seller note on *partial* standby affect my required equity injection for an acquisition?","url":"https://dealroom.so/sba-7a/questions/how-does-a-seller-note-on-partial-standby-affect-my-required-equity-injection-for-an-acqui"},{"question":"What are the specific conditions for an acceptable full standby agreement?","url":"https://dealroom.so/for-lenders/questions/what-are-the-specific-conditions-for-an-acceptable-full-standby-agreement"},{"question":"What are the requirements for a seller note to be structured with partial standby for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/what-are-the-requirements-for-a-seller-note-to-be-structured-with-partial-standby-for-a-bu"}]},"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 — Partial Standby Agreement","url":"https://dealroom.so/glossary/partial-standby-agreement","source_type":"DealRoom Data"}}