Glossary · Doing the deal
In short
Costs incurred by the lender when recovering assets from a defaulting borrower to satisfy a loan. These can include legal fees, appraisal costs, and selling expenses.
If your business defaults on an SBA loan, the lender will incur various costs to seize and sell collateral. These liquidation expenses are typically deducted from the proceeds of asset sales before applying funds to the outstanding loan balance, potentially increasing the amount still owed by guarantors.
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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