Glossary · Reading the business
In short
These are potential financial obligations that depend on the outcome of a future event, like a pending lawsuit or product warranty claim. They aren't current debts but could become liabilities.
During due diligence, you must identify any contingent liabilities the business faces. These can significantly impact the business's future cash flow and valuation if they materialize. Work with your attorney to assess the risk and consider escrow or holdback arrangements to protect yourself.
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.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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