{"ok":true,"canonical_url":"https://dealroom.so/sba-loans/basics/are-there-any-specific-character-or-background-checks-for-owners-applying-for-an-sba-7-a-l","api_url":"https://dealroom.so/api/public/questions/are-there-any-specific-character-or-background-checks-for-owners-applying-for-an-sba-7-a-l","question":"Are there any specific character or background checks for owners applying for an SBA 7(a) loan?","topic":"Character requirements","audience":"new","bot_mode":"buyer","short_answer":"Yes, all owners of 20% or more of the business must undergo specific character and background checks as part of the SBA 7(a) loan application process.","rule":"The SBA requires applicants and principals to disclose information about their criminal history, outstanding legal judgments, and certain tax delinquencies on SBA Form 1919. Lenders will conduct background checks, including a review of criminal records, to verify this information. Certain serious offenses or unaddressed financial issues can lead to ineligibility.","example":"During the application, an owner discloses a minor felony from 15 years ago that resulted in no jail time. The lender conducts a background check to verify this information and submits it to the SBA for character review if required, which could still be approved due to the age and nature of the offense.","what_lenders_check":"Lenders must accurately collect and verify all character information and adhere to SBA rules regarding criminal history. They are responsible for ensuring all principals meet the character requirements to maintain the loan guaranty.","required_facts":["Background checks","Criminal history disclosure","Outstanding judgments","Tax delinquencies","SBA Form 1919"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","SBA Form 1919 - Borrower Information Form","13 CFR Part 120 - Business Loans","Criminal Justice Reviews for SBA Business Loan Programs - Final Rule"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"SBA Form 1919 - Borrower Information Form","url":"https://www.sba.gov/sites/default/files/2025-03/2025.02.27%20Form%201919%20-%20Updates%20%28FINAL%29_03-12-2025%20%281%29.pdf"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"},{"title":"Criminal Justice Reviews for SBA Business Loan Programs - Final Rule","url":"https://www.federalregister.gov/documents/2024/04/30/2024-09009/criminal-justice-reviews-for-the-sba-business-loan-programs-disaster-loan-programs-and-surety-bond"}],"related_questions":[{"question":"Can a business with owners who have a past criminal record get an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/can-a-business-with-owners-who-have-a-past-criminal-record-get-an-sba-7-a-loan"}],"related_terms":[{"term":"Character and Background Checks","url":"https://dealroom.so/glossary/character-and-background-checks"},{"term":"Background Checks","url":"https://dealroom.so/glossary/background-checks"},{"term":"SBA 7(a) program","url":"https://dealroom.so/glossary/sba-7-a-program"},{"term":"SBA 7(a) loan","url":"https://dealroom.so/glossary/sba-7-a-loan"},{"term":"Aggregate SBA 7(a) Loan Eligibility","url":"https://dealroom.so/glossary/aggregate-sba-7-a-loan-eligibility"},{"term":"SBA 7(a) Loan Program","url":"https://dealroom.so/glossary/sba-7-a-loan-program"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-13","sba_rule_sources_checked_through":"2026-06-13"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-loans/basics/are-there-any-specific-character-or-background-checks-for-owners-applying-for-an-sba-7-a-l","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}