Glossary · The loan itself
In short
A temporary period during which a borrower only pays interest on a loan, with no payments made towards the principal balance.
In some 7(a) loan structures, particularly for startups or businesses needing time to ramp up, a short period of principal deferral might be negotiated. This can ease initial cash flow pressure. However, interest still accrues, and the principal payments will eventually begin, often resulting in slightly higher payments later or a longer amortization period.
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.
See which SBA lenders would fund your deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to approve a 7(a) like yours and flag what trips up approval.
Free · No documents · Usually same-day