{"ok":true,"canonical_url":"https://dealroom.so/glossary/unlimited-liability","api_url":"https://dealroom.so/api/public/glossary/unlimited-liability","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":"unlimited-liability","term":"Unlimited liability","group":"People and paperwork","definition":"A legal structure where an owner's personal assets are not protected from the business's debts and obligations. Creditors can pursue the owner's personal wealth.","what_it_means":"This is a key risk factor for buyers, common in sole proprietorships and general partnerships. For an SBA 7(a) loan, you'll provide a Personal Guarantee regardless, but a business structure like an LLC or Corporation still offers protection against other business liabilities beyond the loan. Always consider structuring your acquisition to limit liability where possible.","url":"https://dealroom.so/glossary/unlimited-liability","official_sources":[],"related":[{"slug":"personal-liability","term":"Personal liability","url":"https://dealroom.so/glossary/personal-liability"},{"slug":"general-partner","term":"General partner","url":"https://dealroom.so/glossary/general-partner"},{"slug":"limited-partner","term":"Limited partner","url":"https://dealroom.so/glossary/limited-partner"},{"slug":"personal-guarantee","term":"Personal guarantee","url":"https://dealroom.so/glossary/personal-guarantee"}],"related_questions":[{"question":"Do all individuals with 20% or more ownership always provide an unlimited personal guaranty?","url":"https://dealroom.so/sba-7a/questions/do-all-individuals-with-20-or-more-ownership-always-provide-an-unlimited-personal-guaranty"},{"question":"How does an unlimited personal guaranty differ from a limited one for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/how-does-an-unlimited-personal-guaranty-differ-from-a-limited-one-for-an-sba-7-a-loan"}]},"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 — Unlimited liability","url":"https://dealroom.so/glossary/unlimited-liability","source_type":"DealRoom Data"}}