Glossary · The loan itself
In short
Occurs when additional debt is introduced into the capital structure of a business that already has an SBA loan. The SBA generally restricts this to protect its lien position.
The SBA typically requires a first lien position on all collateral. Introducing new debt that subordinates the SBA's position or adds undue risk is usually prohibited. Any additional financing post-closing must be approved by the SBA to ensure it doesn't jeopardize the government's interest.
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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