Glossary · Reading the business
Lease Term
In short
The duration of a lease agreement, specifying how long the tenant has the right to occupy the property. This is crucial for businesses operating from a leased location.
What it means in a deal
For an SBA 7(a) loan, the lease term for the business's operating location must typically match or exceed the loan's maturity. You'll need to secure a new lease or an assignment of the existing lease with a sufficient term. A short lease term could be a deal-breaker if you can't negotiate an extension with the landlord.
Official sources
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 Lease Term
- Can an SBA 7(a) loan finance tenant improvements on leased property if the lease term matches the loan term?
- If I am buying a business that leases its property, can I get a longer loan term if the lease is long-term?
- What happens if the business's current lease agreement for its premises is short-term or expiring soon?
- Does a shared commercial lease agreement between two separate businesses trigger affiliation for SBA size standards?
- If the business property is leased, can the SBA loan finance a security deposit for the lease?
- When can a lender approve a short-term deferment or modification of a 7(a) loan's payment terms without prior SBA consent?
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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