{"ok":true,"canonical_url":"https://dealroom.so/glossary/ineligible-loan","api_url":"https://dealroom.so/api/public/glossary/ineligible-loan","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"ineligible-loan","term":"Ineligible loan","group":"The loan itself","definition":"An SBA loan that fails to meet specific SBA eligibility requirements. If deemed ineligible, the SBA can deny its guaranty, jeopardizing your deal.","what_it_means":"The SBA has strict rules on who can borrow, what type of business can be financed, and how loan proceeds can be used. Lenders perform due diligence to ensure eligibility, but you as the buyer should also understand these rules (e.g., \"ineligible businesses rule,\" \"credit elsewhere test\"). An ineligible loan means no SBA guaranty, which can derail your deal.","url":"https://dealroom.so/glossary/ineligible-loan","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"ineligible-businesses-rule","term":"Ineligible businesses rule","url":"https://dealroom.so/glossary/ineligible-businesses-rule"},{"slug":"credit-elsewhere-test","term":"Credit elsewhere test","url":"https://dealroom.so/glossary/credit-elsewhere-test"},{"slug":"sba-guaranty","term":"SBA guaranty","url":"https://dealroom.so/glossary/sba-guaranty"},{"slug":"sop-50-10","term":"SOP 50 10","url":"https://dealroom.so/glossary/sop-50-10"}],"related_questions":[{"question":"Are there any specific industries that are generally ineligible for SBA 7(a) loans?","url":"https://dealroom.so/sba-loans/basics/are-there-any-specific-industries-that-are-generally-ineligible-for-sba-7-a-loans"},{"question":"Are there specific types of businesses or industries that are ineligible for SBA 7(a) loans?","url":"https://dealroom.so/sba-7a/questions/are-there-specific-types-of-businesses-or-industries-that-are-ineligible-for-sba-7-a-loans"},{"question":"What makes a business ineligible for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-makes-a-business-ineligible-for-an-sba-7-a-loan"},{"question":"Are certain business types explicitly ineligible for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/are-certain-business-types-explicitly-ineligible-for-an-sba-7-a-loan"},{"question":"What makes an existing business ineligible for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-makes-an-existing-business-ineligible-for-an-sba-7-a-loan"},{"question":"What kind of businesses are generally ineligible for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-kind-of-businesses-are-generally-ineligible-for-an-sba-7-a-loan"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Ineligible loan","url":"https://dealroom.so/glossary/ineligible-loan","source_type":"DealRoom Data"}}