Glossary · Reading the business
In short
This financial metric measures how much a business relies on debt to finance its assets. A high ratio indicates higher financial risk.
Lenders use leverage ratios to assess the financial health of the business you're acquiring and its ability to take on new debt. A common ratio is Total Debt to EBITDA. A high ratio might concern a lender, indicating the business could struggle with repayment, so understand the target business's current and projected leverage.
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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