Glossary · Reading the business
In short
A liability is a financial obligation or debt owed by an individual or business. For a buyer, understanding a business's liabilities is key to assessing its true financial health.
In an acquisition, you must identify all business liabilities, including debts, accounts payable, and potential legal claims, which impact the business's balance sheet. Your personal guarantee on an SBA 7(a) loan also creates a significant personal liability.
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.
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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