Glossary · The loan itself
In short
A loan is defaulted when the borrower fails to meet the terms of the loan agreement, most commonly by missing payments. This triggers serious consequences for both the borrower and the lender.
If your SBA loan defaults, the lender can pursue collection actions, including enforcing personal guarantees and liquidating collateral. A default can severely damage your credit and lead to personal judgments. Understand all the conditions in your loan agreement to avoid default and protect your investment and personal assets.
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.
See which SBA lenders would fund your deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to approve a 7(a) like yours and flag what trips up approval.
Free · No documents · Usually same-day