Glossary · The loan itself
In short
This is a flexible loan facility for businesses, allowing them to draw funds as needed up to a certain limit and repay them. It's used for working capital or short-term operational needs.
While an SBA 7(a) loan is primarily for acquisition and long-term assets, a separate commercial line of credit can be vital for ongoing working capital needs post-acquisition, especially for seasonal businesses. Note that an SBA 7(a) loan generally cannot be used to pay off a separate commercial line of credit unless it's for specific eligible purposes like business debt refinancing under strict conditions.
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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