Glossary · The loan itself
Initial disbursement
In short
This is the first release of funds from your SBA loan, which typically occurs at closing. It covers the purchase price, working capital, and other immediate project costs.
What it means in a deal
The timing of the initial disbursement is tied directly to your closing date. Ensure all conditions precedent to funding are met, as delays can push back the disbursement. All subsequent disbursements, if any, will follow specific terms outlined in your loan agreement and the SBA Loan Authorization.
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 Initial disbursement
- After SBA 7(a) loan approval, what's the typical timeframe for closing and disbursement?
- How does a lender resolve an E-Tran error where the authorized loan amount is incorrect after approval but before disbursement?
- Can an SBA 7(a) loan fund initial inventory for a new business?
- What is the typical timeframe from submitting a complete application to receiving initial funding?
- Does an SBA 7(a) loan cover the initial franchise fee and associated startup costs?
- Can the SBA 7(a) loan include funds to cover initial operating losses post-acquisition?
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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