SBA Updates

SBA is coming out with more updates.  Here are the changes.

• Decreasing the maximum loan size for 7a small loans from $500,000 to $350,000 on taking real estate collateral. This means that lenders will now be required to take available real estate as collateral for loans $350,001 and above if the loan is not considered fully secured, as opposed to before when we only had to take real estate as collateral when the loan was at $500,001 or higher.

• Seller debt may now only be counted as a part of the equity injection if the debt is on standby for the full term of the loan and does not exceed 50% of the required injection.

• Sellers in a partial change of ownership are required to provide a limited guarantee of the full loan amount for a minimum of 2 years after disbursement, regardless of the amount of ownership retained.

• Reinstating the Franchise Directory – Franchises listed on the directory as of 5/11/2023 will have until 7/31/2025 to execute the SBA Franchisor/Distributor Certification to maintain their listing on the directory. Franchises will have to be listed on the Directory in order to be eligible to receive SBA financing. 

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