{"ok":true,"canonical_url":"https://dealroom.so/glossary/pre-paid-lease","api_url":"https://dealroom.so/api/public/glossary/pre-paid-lease","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":"pre-paid-lease","term":"Pre-paid lease","group":"People and paperwork","definition":"A lease payment made in advance for future occupancy or use of an asset. For a buyer, this means the seller has already covered some of your future occupancy costs, which is a benefit.","what_it_means":"In a 7(a) acquisition, a pre-paid lease often gets factored into working capital adjustments or as an asset on the balance sheet. Verify the period covered and ensure it's transferable to you as the new owner. It reduces your immediate cash outflow post-closing.","url":"https://dealroom.so/glossary/pre-paid-lease","official_sources":[],"related":[{"slug":"lease-agreement","term":"Lease agreement","url":"https://dealroom.so/glossary/lease-agreement"},{"slug":"working-capital","term":"Working capital","url":"https://dealroom.so/glossary/working-capital"},{"slug":"asset-purchase","term":"Asset purchase","url":"https://dealroom.so/glossary/asset-purchase"}],"related_questions":[{"question":"Can a buyer contribute a pre-paid lease agreement for the business premises as part of their equity injection?","url":"https://dealroom.so/sba-7a/questions/can-a-buyer-contribute-a-pre-paid-lease-agreement-for-the-business-premises-as-part-of-the"},{"question":"Can a substantial pre-paid rent deposit on a commercial lease count towards the equity injection for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/can-a-substantial-pre-paid-rent-deposit-on-a-commercial-lease-count-towards-the-equity-inj"},{"question":"If the business property is leased, can the SBA loan finance a security deposit for the lease?","url":"https://dealroom.so/sba-7a/questions/if-the-business-property-is-leased-can-the-sba-loan-finance-a-security-deposit-for-the-lea"},{"question":"If the business property is leased, can an SBA 7(a) loan finance security deposits for the lease?","url":"https://dealroom.so/sba-loans/basics/if-the-business-property-is-leased-can-an-sba-7-a-loan-finance-security-deposits-for-the-l"},{"question":"Can an SBA 7(a) loan finance tenant improvements on leased property if the lease term matches the loan term?","url":"https://dealroom.so/sba-7a/questions/can-an-sba-7-a-loan-finance-tenant-improvements-on-leased-property-if-the-lease-term-match"},{"question":"If I am buying a business that leases its property, can I get a longer loan term if the lease is long-term?","url":"https://dealroom.so/sba-7a/questions/if-i-am-buying-a-business-that-leases-its-property-can-i-get-a-longer-loan-term-if-the-lea"}]},"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 — Pre-paid lease","url":"https://dealroom.so/glossary/pre-paid-lease","source_type":"DealRoom Data"}}