Glossary · The loan itself
Personal loan
In short
A personal loan is debt taken out by an individual, not a business. For a business acquisition, your personal loan funds can be part of your equity injection, but must be fully unsecured and not funded by the business itself.
What it means in a deal
If you use a personal loan for your equity injection, the SBA requires it to be unsecured and not sourced from the business you're buying. Lenders will scrutinize the source of these funds to ensure they are "seasoned" or clearly from a legitimate personal source. This ensures your true equity is at risk in the deal.
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 Personal loan
- Why does the SBA mandate personal guaranties for 7(a) loans?
- What is a 'personal guarantee' and why is it required for SBA loans?
- What is the purpose of the personal guaranty requirement for SBA 7(a) loans?
- What constitutes an 'associate' that may require a personal guaranty or affiliation review for 7(a) loans?
- Does a personal guaranty extend to my personal assets acquired after the loan closing date?
- What personal risks do I take with a personal guaranty on an SBA 7(a) loan?
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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