Glossary · People and paperwork
Limited Personal Guaranty
In short
This is a personal promise to repay a debt, but with a cap on the amount or specific conditions that limit your liability. It's less comprehensive than a full personal guarantee.
What it means in a deal
While most key principals in an SBA 7(a) loan must provide a full personal guarantee, a limited personal guaranty might be possible for certain minority owners or in specific circumstances, capping their exposure. Always understand the exact terms and limits of any guarantee you sign.
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 Limited Personal Guaranty
- Can the personal guaranty be limited for certain passive investors or minority owners?
- How does an unlimited personal guaranty differ from a limited one for an SBA 7(a) loan?
- How does the SBA differentiate between a general partner and a limited partner for personal guaranty requirements?
- What if my personal credit score is strong (e.g., 720), but my personal financial statement shows limited liquid assets?
- Can a business owner's personal assets be used as collateral if business assets are limited?
- If business assets are limited, what specific personal assets, besides real estate, might be required as collateral?
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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