Glossary · Reading the business
In short
A state where a business or individual struggles to meet financial commitments. Buying a business in distress requires extra scrutiny and a clear turnaround plan.
While some distressed businesses offer opportunities, an SBA lender will scrutinize the cause of financial distress. You must present a credible business plan showing how you'll stabilize and grow the company. Be prepared to explain how your management and capital injection will reverse the negative trends.
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.
Free · No documents · Usually same-day