Glossary · People and paperwork
Cancelled Checks
In short
Checks that have been processed and paid by the bank, serving as proof of payment. For due diligence, cancelled checks provide an audit trail for specific expenses or payments made by the seller.
What it means in a deal
While less common for large transactions today, cancelled checks (or images of them) can still be requested during due diligence to verify specific payments or expenses of the business. For your equity injection, cancelled checks from your personal account may be accepted as proof of funds, but wire confirmations are generally preferred for larger amounts.
Related terms
Common questions about Cancelled Checks
- Who specifically counts as an 'associate' for SBA business size checks?
- Does the lender need to collect separate consent forms for background checks from non-owner spouses?
- Are there any specific character or background checks for owners applying for an SBA 7(a) loan?
- What steps must a lender take in E-Tran if a previously authorized 7(a) loan needs to be cancelled before closing?
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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