Glossary · Your money in the deal
In short
A Standby Period is a time, typically 1-2 years, during which a seller note or other subordinated debt cannot receive principal or interest payments. This makes your equity injection look stronger.
If a portion of the seller's proceeds is structured as a seller note to meet the equity injection requirement, it must be on "full standby" for at least the first 24 months. This means no payments can be made on the note during this period, ensuring the business's cash flow prioritizes the SBA loan. Understand how any seller financing impacts your required equity injection and the business's debt service.
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.
Figure out your down payment and equity injection
Tell us your purchase price and how you're funding the down payment — we'll sanity-check the equity injection and show what lenders will actually accept.
Free · No documents · Usually same-day