{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/does-the-remaining-owner-have-to-personally-guarantee-the-sba-loan-after-a-buyout","api_url":"https://dealroom.so/api/public/questions/does-the-remaining-owner-have-to-personally-guarantee-the-sba-loan-after-a-buyout","question":"Does the remaining owner have to personally guarantee the SBA loan after a buyout?","topic":"Partner & owner buyout","audience":"borrower","bot_mode":"buyer","short_answer":"Yes, any individual owning 20% or more equity in the business after the buyout is required to personally guarantee the SBA loan.","rule":"SBA rules mandate that all owners holding 20% or more equity in the business must provide a full, unconditional personal guarantee for the SBA loan. This ensures that principals have a vested interest in the business's success and are personally responsible for repayment.","example":"After a buyout, if Alex owns 100% of the business, he must provide a personal guarantee. If Alex owns 60% and his spouse, who is also active, owns 40%, both Alex and his spouse must personally guarantee the loan.","what_lenders_check":"Lenders ensure all qualifying owners execute the required personal guarantees, verifying their ownership percentages based on the post-transaction structure. They also assess the personal financial strength of each guarantor.","required_facts":["20%+ owner guarantee","Full, unconditional","Personal responsibility","All principals guarantee"],"source_families":["SOP 50 10 — Lender and Development Company Loan Programs","SBA Form 1919 — Borrower Information Form"],"official_sources":[{"title":"SOP 50 10 — Lender and Development Company Loan Programs","url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs"},{"title":"SBA Form 1919 — Borrower Information Form","url":"https://www.sba.gov/document/sba-form-1919-borrower-information-form"}],"related_questions":[{"question":"Can I buy out my business partner with an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-i-buy-out-my-business-partner-with-an-sba-7-a-loan"},{"question":"Can a partner buyout be done with zero money down under the SBA?","url":"https://dealroom.so/sba-7a/questions/can-a-partner-buyout-be-done-with-zero-money-down-under-the-sba"},{"question":"What is the 24-month ownership rule for a $0-down SBA partner buyout?","url":"https://dealroom.so/sba-7a/questions/what-is-the-24-month-ownership-rule-for-a-0-down-sba-partner-buyout"},{"question":"Is a partner buyout a complete or partial change of ownership for the SBA?","url":"https://dealroom.so/sba-7a/questions/is-a-partner-buyout-a-complete-or-partial-change-of-ownership-for-the-sba"},{"question":"Can the company itself redeem the departing partner's shares with an SBA loan?","url":"https://dealroom.so/sba-7a/questions/can-the-company-itself-redeem-the-departing-partner-s-shares-with-an-sba-loan"},{"question":"Can a seller note be used to buy out a partner, and must it be on standby?","url":"https://dealroom.so/sba-7a/questions/can-a-seller-note-be-used-to-buy-out-a-partner-and-must-it-be-on-standby"}],"related_terms":[{"term":"Buyout of a Partner","url":"https://dealroom.so/glossary/buyout-of-a-partner"},{"term":"Partner buyout","url":"https://dealroom.so/glossary/partner-buyout"},{"term":"Owner Buyout","url":"https://dealroom.so/glossary/owner-buyout"},{"term":"SBA loan guarantee","url":"https://dealroom.so/glossary/sba-loan-guarantee"},{"term":"Claim on the SBA Guarantee","url":"https://dealroom.so/glossary/claim-on-the-sba-guarantee"},{"term":"SBA guarantee","url":"https://dealroom.so/glossary/sba-guarantee"}],"related_tools":[{"name":"Partner Buyout toolkit","url":"https://dealroom.so/sba-7a/partner-buyout"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-15","sba_rule_sources_checked_through":"2026-06-15"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/does-the-remaining-owner-have-to-personally-guarantee-the-sba-loan-after-a-buyout","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}