Glossary · Your money in the deal
Financial Interest
In short
This refers to any stake an individual or entity has in the business, whether through ownership, debt, or other arrangements. For buyers, it defines who needs to be part of the deal structure, especially regarding equity injection and guaranties.
What it means in a deal
The SBA defines "Financial Interest" broadly, including equity holders, those with management roles, and sometimes even lenders to the business. Anyone with a 20% or more Financial Interest in the borrower entity must personally guarantee the loan. Less than 20% might still require a guaranty if they have significant control.
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 Financial Interest
- What if my personal financial statement shows low liquid assets?
- Are SBA 7(a) loans exclusively for businesses with financial difficulties?
- What if my business is new and has no financial history?
- Does misrepresenting financial information on the SBA application automatically kill approval?
- How does my personal financial history affect SBA 7(a) loan approval?
- What specific financial documentation will I need to provide for my personal finances?
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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