Glossary · Doing the deal
Collateral Package
In short
This refers to all the assets pledged to secure an SBA loan, ensuring the lender can recover funds if you default. It typically includes business assets and, if needed, personal assets.
What it means in a deal
For an SBA 7(a) loan, the lender will take a first lien on all business assets. If there's a collateral shortfall, they may require a lien on personal assets, like your home (often a second mortgage). Understand every asset included in your collateral package and its implications for you.
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 Collateral Package
- How does a lender process a Universal Purchase Package (UPP) when collateral is still being liquidated?
- What is the primary purpose of the Universal Purchase Package (UPP)?
- Can a lender include unapproved legal fees in a Universal Purchase Package (UPP)?
- What is the primary purpose of the Universal Purchase Package (UPP) for lenders?
- What happens if a lender submits an incomplete Universal Purchase Package (UPP) to the SBA?
- What documentation is required to request a guaranty purchase using the Universal Purchase Package (UPP)?
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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