SBA 7a Loans – Eligibility

SBA 7a Loan Eligibility

An exhaustively researched white paper and borrower guide to SBA 7a loans.

Do you Meet the Basic Eligibility Requirements for an SBA 7a Loan?

The SBA eligibility requirements are detailed very specifically in several public documents (but not always clearly), including in the SBA’s 587 page Standard Operating Procedure document SOP 50 10 6 updated for October, 2020.

The ten page SOP section on 7a loan eligibility begins on page 117.  The language below comes directly from the SOP referenced above.

Text in ITALICS is provided for clarification by Jeff Bardos, CEO, Speritas Capital Partners.

Call or email Speritas Capital Partners and we can quickly let you know if you are eligible or not.

A. You Must be an Operating Business (except for Eligible Passive Companies).

B. You Must Be Organized for Profit

C. You Must Be Located in the United States (including its territories and possessions).

D. You Must be Be Small Under SBA Size Requirements (13 CFR Part 121).  (There are special rules for franchises.) The Applicant may qualify under either the industry small business size standards or the alternative size standard.

E.g. You must have tangible net worth of less than $15MM (Assets – Liabilities) – (Goodwill) = Tangible Net Worth and earned less than $5MM on average over the past two years. 

E. You Must Demonstrate the Need for Desired Credit (Credit not available elsewhere).  The Lender must certify that the Applicant does not have the ability to obtain some or all of the requested loan funds on reasonable terms from non-Federal, non-State, or non-local government sources, including from the SBA Lender or Third Party Lender, without SBA assistance.

Lenders must include in their files proof that you have tried to use other financial resources, including personal assets, and applied for funding elsewhere without success before applying for an SBA loan. In a 2020 clarification, the SBA “Clarified that, when determining whether credit is available elsewhere, SBA Lenders may not cite the Applicant’s inability to meet the SBA Lender’s or Third Party Lender’s
conventional credit score policy as the sole reason that credit is not available elsewhere.”

Note that lenders have their own eligibility standards (in addition to those imposed by the SBA), and that you can be turned down for an SBA loan at one lender, and approved at another.

This is often based on the lender’s own credit limits, and their understanding of / and appetite for risk within a particular industry. This is where an experienced commercial loan broker with deep lender relationships like Speritas Capital Partners can add a lot of value by knowing the best SBA lenders for your situation.

Other Requirements…

You must be an eligible business type. See our comprehensive list of SBA ineligible business types.  For example, you must be a US citizen, or majority owned by a US or naturalized citizen, and you can’t be delinquent on any federal debt/loan such as student loans.

You must also meet the SBA’s Credit Criteria.

View our SBA White Paper Sources List.

Contact Us

You need a strategic, cost effective solution to your financing needs and a funding partner you can trust. Let us put our decades of banking and structuring experience to work for you – with no upfront feesEmail Speritas Capital Partners about your eligibility for an SBA 7(a) loan today.


Call/text Jeff Bardos, CEO
directly at 203-247-4358
Schedule a call

© 2021 Speritas Capital Partners LLC | All Rights Reserved