Glossary · Doing the deal
Security Agreement
In short
A legal document that grants the lender a security interest in specific assets of the business (collateral) to secure the loan. If you default, the lender can seize these assets.
What it means in a deal
This is a core closing document. It lists all the business assets—accounts receivable, inventory, equipment, general intangibles—that serve as collateral for your SBA loan. The Security Agreement allows the lender to file a UCC lien, giving them a legal claim to those assets. Understand what assets are pledged and the implications if the business fails to repay the loan.
Related terms
Common questions about Security Agreement
- How does the SBA require lenders to perfect security interests on accounts receivable and inventory?
- How does a lender perfect a security interest in intellectual property for a 7(a) loan?
- If the seller requires a security interest, how does it affect the standby status of their note?
- Do I have to put up my personal house as security for an SBA 7(a) loan?
- If the business property is leased, can the SBA loan finance a security deposit for the lease?
- If the business property is leased, can an SBA 7(a) loan finance security deposits for the lease?
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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