{"ok":true,"canonical_url":"https://dealroom.so/glossary/predatory-lending","api_url":"https://dealroom.so/api/public/glossary/predatory-lending","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":"predatory-lending","term":"Predatory lending","group":"The loan itself","definition":"This refers to lending practices that are unfair, deceptive, or abusive, often targeting vulnerable borrowers with excessive fees, high interest rates, or terms designed to trap them in debt. The SBA 7(a) program has rules to prevent this.","what_it_means":"While SBA loans are highly regulated to protect borrowers, it's crucial to understand all loan terms, fees, and interest rates. Predatory practices can include hidden fees, escalating rates, or complex terms designed to obscure the true cost. Always review your loan documents carefully and ask your advisor about anything unclear. The SBA sets maximum interest rates and limits on fees.","url":"https://dealroom.so/glossary/predatory-lending","official_sources":[{"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"},{"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"}],"related":[{"slug":"lender-closing-costs","term":"Lender closing costs","url":"https://dealroom.so/glossary/lender-closing-costs"},{"slug":"spread","term":"Spread","url":"https://dealroom.so/glossary/spread"},{"slug":"interest-only-payment","term":"Interest-Only Payment","url":"https://dealroom.so/glossary/interest-only-payment"},{"slug":"variable-rate","term":"Variable rate","url":"https://dealroom.so/glossary/variable-rate"}],"related_questions":[{"question":"What constitutes prudent lending standards for SBA 7(a) underwriting?","url":"https://dealroom.so/for-lenders/questions/what-constitutes-prudent-lending-standards-for-sba-7-a-underwriting"},{"question":"What specific advantages does the SBA guaranty offer to the *lending bank*?","url":"https://dealroom.so/sba-loans/basics/what-specific-advantages-does-the-sba-guaranty-offer-to-the-lending-bank"},{"question":"What does the SBA 'guaranty' really mean for a bank lending money?","url":"https://dealroom.so/sba-loans/basics/what-does-the-sba-guaranty-really-mean-for-a-bank-lending-money"},{"question":"What constitutes prudent lending standards for SBA 7(a) underwriting regarding credit analysis?","url":"https://dealroom.so/for-lenders/questions/what-constitutes-prudent-lending-standards-for-sba-7-a-underwriting-regarding-credit-analy"},{"question":"How does the SBA assess \"prudent lending standards\" in 7(a) loan underwriting?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-assess-prudent-lending-standards-in-7-a-loan-underwriting"},{"question":"How does the 'not engaged in lending' rule apply to a loan applicant?","url":"https://dealroom.so/for-lenders/questions/how-does-the-not-engaged-in-lending-rule-apply-to-a-loan-applicant"}]},"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 — Predatory lending","url":"https://dealroom.so/glossary/predatory-lending","source_type":"DealRoom Data"}}