Glossary · People and paperwork
In short
A guarantor is someone who promises to repay a loan if the primary borrower defaults. For an SBA loan, all owners with 20% or more equity are typically required to be guarantors.
As a buyer, if you own 20% or more of the acquired business, you will be a guarantor, providing a personal guarantee. This means your personal assets are at risk if the business loan defaults. Understand the full extent of this commitment.
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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