Glossary · People and paperwork
In short
This is an individual who promises to repay a business loan if the business defaults. All owners with 20% or more equity are typically required to be one.
As the buyer of a small business with an SBA loan, you will be required to sign a personal guarantee. This means your personal assets are at risk if the business fails to repay the loan, making you personally responsible. The SBA requires this for all owners with significant equity stakes.
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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