Glossary · Your money in the deal
In short
A formal agreement where the seller agrees to defer repayment of any seller debt until the SBA loan is fully satisfied. This ensures the SBA lender is prioritized for repayment.
This agreement is mandatory for any seller debt included in an SBA 7(a) deal. It prevents the seller from competing with the SBA lender for repayments, which improves the business's debt service coverage. Ensure your LOI outlines the seller note's terms and standby status.
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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