Glossary · People and paperwork
In short
This is the legal structure under which a business operates, such as a sole proprietorship, partnership, corporation, or LLC. Your choice impacts liability, taxation, and operational flexibility.
You'll need to decide on your new business entity before closing the SBA loan. Lenders will require documentation for your chosen entity (e.g., LLC operating agreement, corporate bylaws) to ensure proper legal formation and ownership structure for the loan. Most buyers choose an LLC for liability protection.
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.
Know what you'll need before you apply
Tell us about the deal and who's buying — we'll flag the guaranty, eligibility, and paperwork issues that slow SBA approval before they cost you time.
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