Glossary · Your money in the deal
In short
This is a seller note where repayment is tied to the future performance of the business. If the business doesn't meet specific targets, the seller may not get paid.
The SBA views this as an Earnout or Seller Note. For SBA 7(a) loans, seller financing must typically be on "full standby" or "partial standby" for the life of the loan. Contingent payments are usually not allowed to impact the buyer's ability to repay the SBA loan.
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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