Glossary · The loan itself
Amortization
In short
Paying a loan down in equal monthly payments of principal and interest. 7(a) acquisition loans fully amortize — no balloon payment at the end.
What it means in a deal
With a fully amortizing loan, every payment chips away at principal from day one. By the end of the ten-year term, the balance is zero — no surprise final payment. Early in the term, most of each payment is interest; later, it flips to mostly principal. This is important for modeling: your DSCR calculation uses the actual payment, which stays consistent, not just the interest portion.
Related terms
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 2026-06-16 · 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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