Glossary · People and paperwork
In short
This occurs when you, as the borrower, fail to meet a condition or obligation outlined in your SBA loan agreement. It can lead to penalties, acceleration of the loan, or even default.
Your loan agreement will detail specific covenants and conditions you must uphold, like maintaining certain financial ratios or providing annual tax returns. A breach, even a minor one, can trigger actions from your lender, so understand all terms before signing. Consistent compliance is key to avoiding issues.
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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