Glossary · Reading the business
In short
This is the chance the business won't generate enough cash to pay its debts, including your SBA loan. As a buyer, you need to assess this carefully because you're personally guaranteeing the loan.
Lenders evaluate default risk by looking at historical financial performance and projecting future cash flow. Your job is to understand the drivers of that risk, like customer concentration or market volatility, and build a strong business plan to mitigate it.
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.
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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