Glossary · The loan itself
90-Day Rule
In short
This SBA rule limits what collateral or equity can be injected or released within 90 days of an SBA loan application or disbursement. It prevents circular funding or "round-tripping."
What it means in a deal
The SBA's 90-Day Rule is designed to prevent buyers from injecting funds into the business and then immediately pulling them back out or using them to pay off personal debt, masquerading as equity. Any funds or collateral injected or substantial payments made within 90 days of the loan application or closing will be scrutinized. Ensure your equity injection is "seasoned" and genuinely from your own resources.
Official sources
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.
Related terms
Common questions about 90-Day Rule
- What is the significance of the "90-day rule" regarding equity injection and prior payments?
- How does the '90-day rule' affect the calculation of SBA upfront guaranty fees for multiple loans?
- How does a lender ensure compliance with the '90-day rule' for guaranty fee payment for a 7(a) loan?
- What are the consequences if a lender fails to remit the SBA upfront guaranty fee within the 90-day requirement?
- What are the requirements for a lender to obtain an extension of the 90-day E-Tran authorization validity period?
- Are day-to-day operational expenses like rent or utilities an allowed use of SBA 7(a) loan funds?
Defined by CapBench 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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