Glossary · Reading the business
In short
An initial environmental assessment of a property to identify potential contamination (Recognized Environmental Conditions). It involves site inspection and records review, not soil testing.
Required for SBA 7(a) loans involving real estate if an Environmental Questionnaire reveals potential issues. A qualified environmental consultant performs it. If the Phase I identifies significant concerns, the lender may require a Phase II, which involves invasive testing and can delay or kill a deal.
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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