Glossary · People and paperwork
In short
Lawsuits against the business or seller can create significant financial liabilities or distract from operations. Buyers need to identify any pending cases to assess risks and potential costs before closing.
During due diligence, you must uncover any lawsuits or legal disputes the business or its principals are involved in. Your lender will also scrutinize this, as it impacts the business's financial health and ability to repay the loan. Ensure any material litigation is resolved or accounted for in the deal terms.
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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