Glossary · The loan itself
Federal grant
In short
A federal grant is money given by the government that does not need to be repaid, typically for specific projects or purposes. It is distinct from an SBA loan, which is debt.
What it means in a deal
Federal grants are generally not available for purchasing an existing for-profit small business. SBA 7(a) loans are debt instruments designed for business acquisition, not grants. Do not confuse the two; focus on structuring a viable loan and equity injection for your deal.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Federal grant
- Can a non-profit organization provide a grant that counts towards my equity injection?
- Can I use a conditional grant from a local economic development agency as equity?
- Is an SBA 7(a) loan a grant that I do not have to repay?
- Is an SBA 7(a) loan a type of government grant that I don't have to repay?
- Can a non-profit organization provide a grant that counts towards my equity injection for an SBA 7(a) loan?
- What if a business applicant has outstanding federal tax liens or delinquencies?
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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