Glossary · Doing the deal
Asset Recovery
In short
The process by which a lender reclaims and sells collateral to recoup losses when a loan defaults. As a buyer, understanding this process highlights the lender's security.
What it means in a deal
If an SBA 7(a) loan defaults, the lender will initiate asset recovery, seizing and selling the business's collateral to minimize their losses. This is why the lender conducts thorough collateral analysis and requires perfection of their liens. As a buyer, you need to understand what assets are pledged and how critical they are to the business's operation, as their loss would be devastating.
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 Asset Recovery
- How does a lender comply with SBA requirements for maximizing recovery on collateral during liquidation?
- What minimum efforts must a lender demonstrate in collection and recovery before submitting a liquidation plan to the SBA?
- What is the difference between an asset and stock purchase in a buyout?
- How does a recent significant personal asset purchase affect my SBA 7(a) loan application?
- What if the business I'm buying has intellectual property (e.g., patents, trademarks) as its main asset?
- How does an SBA 7(a) loan address the financing of intellectual property as a major business asset?
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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