Glossary · Doing the deal
Leasehold Mortgage
In short
This is a mortgage on your leasehold interest in a property, rather than on the property itself. It allows you to use your long-term lease as collateral for a loan.
What it means in a deal
If the business you're buying leases its premises, your SBA lender might require a leasehold mortgage as part of the collateral package. This means the lender has a security interest in your lease, giving them rights if you default. You'll need landlord consent for this, usually through a landlord waiver.
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 Leasehold Mortgage
- When is a leasehold mortgage acceptable as collateral for an SBA 7(a) loan?
- How does a leasehold mortgage on the business property serve as collateral for an SBA 7(a) loan?
- Can I use an SBA 7(a) loan to refinance my existing business mortgage?
- Can an SBA 7(a) loan be used to refinance an existing commercial mortgage?
- Can I use funds from a second mortgage on my personal home for my equity injection?
- What if I want to use a second mortgage on my personal residence for equity injection?
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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