Glossary · The loan itself
In short
When a lender determines a loan is unlikely to be repaid, they write it off as a loss on their books. This often precedes collection efforts or a guaranty purchase.
A charge-off typically occurs after a loan defaults and all reasonable collection efforts fail. For an SBA 7(a) loan, this is a serious event that can lead to the lender calling on the SBA guaranty and pursuing personal guarantees. Avoid this at all costs.
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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