Glossary · Doing the deal
In short
This describes a transaction where both buyer and seller are independent, acting in their own self-interest, and have no pre-existing relationship that could influence the deal terms.
The SBA prefers arms-length transactions because they're less prone to conflicts of interest or inflated valuations. If your deal isn't strictly arms-length, such as with a family member or business partner, the SBA will require additional documentation and scrutiny to ensure fair market value and legitimate business purpose.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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