Glossary · Doing the deal
Pre-closing expenses
In short
These are costs you pay before the loan officially closes, like appraisal fees, environmental reports, or legal fees. You need to budget for these as they're often out-of-pocket.
What it means in a deal
Many pre-closing expenses are part of your equity injection or total project costs, but you pay them directly before closing. Track these carefully as proof of funds may be required, and they contribute to your overall investment.
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 Pre-closing expenses
- Which pre-closing business expenses can count towards equity?
- Can I use pre-closing expenses, like a business broker's fee, as part of my equity injection?
- Can working capital be used for unexpected business expenses after closing?
- Are pre-closing legal and accounting fees eligible to be counted towards my equity injection?
- If I contribute inventory purchased pre-closing for the acquired business, can it count as equity?
- Can pre-closing legal and accounting fees associated with the acquisition be counted towards my 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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