Glossary · People and paperwork
Ownership Share
In short
The percentage of a company that an individual or entity owns. This determines control, profit distribution, and liability, directly impacting your role and return on investment.
What it means in a deal
In an SBA 7(a) deal, anyone with 20% or more Ownership Share is typically considered a Principal (Individual) and must personally guarantee the loan. This means their personal assets are on the line if the business defaults. Understand the implications of your equity injection.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
SBA Form 1919 — Borrower Information Form
U.S. Small Business Administration · SBA form
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Ownership Share
- Can I use an SBA 7(a) loan to buy out a current business partner's ownership share?
- How does the SBA determine affiliation between two businesses if they share common management but no common ownership?
- If I'm buying out a partner, can the SBA loan cover the entire 100% of their ownership share?
- What factors are considered when evaluating affiliation between businesses that share common management?
- How is the valuation of an exiting partner's share handled for an SBA loan?
- Can an SBA 7(a) loan finance 100% of an existing partner's share buyout?
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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