Glossary · Your money in the deal
In short
A prohibited transaction where funds are temporarily moved out of a business and then back in, often to make it appear as if the borrower has more equity or operating capital than they truly possess.
The SBA strictly prohibits 'round-tripped' funds for equity injection. This typically involves a seller or related party lending money to the buyer, who then uses it as their equity, only for the seller to be repaid after closing. The SBA wants genuine, at-risk equity, not a deceptive cash transfer.
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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