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BUSINESS FINANCING GLOSSARY

LLC (Limited Liability Company)

A structure that shields owners’ personal assets while passing profits through to their personal taxes — the most common small-business entity.

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Related terms

Default→Failing to meet the terms of a loan — usually missed payments, but also broken covenants. It can accelerate the full balance and trigger collateral seizure.Personal Guarantee→A promise that you’ll repay the business debt personally if the company can’t. Standard on most small-business loans, secured or not.Operating Agreement→The internal document governing how an LLC is run and owned. Lenders may request it to confirm ownership.

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