{"ok":true,"canonical_url":"https://dealroom.so/glossary/seller-s-financing","api_url":"https://dealroom.so/api/public/glossary/seller-s-financing","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":"seller-s-financing","term":"Seller's Financing","group":"Doing the deal","definition":"When the seller finances a portion of the purchase price, acting as a lender to the buyer. This reduces the cash you need upfront and shows the seller's confidence in the business.","what_it_means":"In an SBA 7(a) acquisition, seller's financing often serves as part of your required equity injection. The SBA requires this financing to be on \"full standby\" for the life of the SBA loan, meaning the seller cannot receive payments until the SBA loan is fully repaid. Negotiate this carefully, as it impacts the seller's cash flow.","url":"https://dealroom.so/glossary/seller-s-financing","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":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"slug":"full-standby-agreement","term":"Full Standby Agreement","url":"https://dealroom.so/glossary/full-standby-agreement"},{"slug":"seller-note","term":"Seller note","url":"https://dealroom.so/glossary/seller-note"},{"slug":"standby","term":"Standby","url":"https://dealroom.so/glossary/standby"}],"related_questions":[{"question":"Does the SBA 7(a) loan program allow for seller training period financing?","url":"https://dealroom.so/sba-loans/basics/does-the-sba-7-a-loan-program-allow-for-seller-training-period-financing"},{"question":"How does seller financing structure impact the required equity injection for a business acquisition?","url":"https://dealroom.so/for-lenders/questions/how-does-seller-financing-structure-impact-the-required-equity-injection-for-a-business-ac"},{"question":"What specific due diligence is required for seller financing in a change of ownership?","url":"https://dealroom.so/for-lenders/questions/what-specific-due-diligence-is-required-for-seller-financing-in-a-change-of-ownership"},{"question":"If the business property is owned by the seller's separate entity, can the SBA 7(a) loan include financing for both the business and the property?","url":"https://dealroom.so/sba-7a/questions/if-the-business-property-is-owned-by-the-seller-s-separate-entity-can-the-sba-7-a-loan-inc"},{"question":"What specific due diligence is needed for seller financing that is not on full standby?","url":"https://dealroom.so/for-lenders/questions/what-specific-due-diligence-is-needed-for-seller-financing-that-is-not-on-full-standby"},{"question":"How much of my equity injection must be cash, rather than other assets or seller financing?","url":"https://dealroom.so/sba-7a/questions/how-much-of-my-equity-injection-must-be-cash-rather-than-other-assets-or-seller-financing"}]},"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 — Seller's Financing","url":"https://dealroom.so/glossary/seller-s-financing","source_type":"DealRoom Data"}}