# Standby creditor agreement

The seller's signed acceptance of no payments for a set period.

It is how a [seller note](https://searchspheresource.com/glossary/seller-note) fills part of the required [equity injection](https://searchspheresource.com/glossary/equity-injection). The lending rules, not the parties' preference, set the terms: no payments of principal or interest for the life of the SBA loan, and no more than half of the injection. A seller who signs one is effectively financing part of your down payment and betting on your success to ever be repaid.

In numbers: On a $4M project, a $200,000 seller note on [full standby](https://searchspheresource.com/glossary/full-standby) can count for half of the $400,000 injection. Since mid-2025 full standby has meant no payments for the life of the SBA loan, where the rule before it asked for 24 months.

Source: https://searchspheresource.com/glossary/standby-creditor-agreement
Not dated: A definition is editorial: what a term means, why it matters, and an example. None of it reads a source that can go stale, so there is no date to take and a stamped one would be the build time wearing a costume.

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