{"ok":true,"canonical_url":"https://dealroom.so/for-lenders/questions/can-an-existing-franchise-location-that-is-not-currently-listed-on-the-sba-franchise-direc","api_url":"https://dealroom.so/api/public/questions/can-an-existing-franchise-location-that-is-not-currently-listed-on-the-sba-franchise-direc","question":"Can an existing franchise location that is not currently listed on the SBA Franchise Directory be eligible for a 7(a) loan?","topic":"Franchise eligibility","audience":"lender","bot_mode":"lender","short_answer":"Yes, an existing franchise location not on the directory can be eligible, but it requires the lender to submit the franchise agreement for a full SBA review to determine its eligibility.","rule":"The SBA maintains a Franchise Directory to streamline the eligibility review for common franchise systems. If a franchise is not listed, the lender must submit the entire franchise agreement, including all addenda, for the SBA to review and determine if it meets the SBA's eligibility requirements, particularly regarding control of the franchisee.","example":"A borrower wants to purchase an existing \"Pizza Palace\" franchise. The lender checks the Franchise Directory and finds it's not listed. The lender then submits the full franchise agreement, operations manual, and any other relevant documents to the SBA for a franchise eligibility review.","what_lenders_check":"The primary concern is ensuring the franchise agreement does not contain any provisions that would give the franchisor undue control over the franchisee, limiting the franchisee's operational independence. This can make the business ineligible for SBA financing.","required_facts":["Franchise not listed","Existing location","SBA review","Franchise agreement","Control"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans"],"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":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"}],"related_questions":[{"question":"What are the specific criteria for a new franchise model to be included on the SBA Franchise Directory?","url":"https://dealroom.so/for-lenders/questions/what-are-the-specific-criteria-for-a-new-franchise-model-to-be-included-on-the-sba-franchi"},{"question":"How does a lender determine if a franchise agreement contains impermissible control provisions not listed on the Directory?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-determine-if-a-franchise-agreement-contains-impermissible-control-provis"},{"question":"What are the specific requirements for a lender to obtain an approved franchise agreement for a 7(a) loan when the franchise is not listed on the SBA Franchise Directory?","url":"https://dealroom.so/for-lenders/questions/what-are-the-specific-requirements-for-a-lender-to-obtain-an-approved-franchise-agreement-"},{"question":"Which specific provisions in a franchise agreement raise red flags for undue franchisor control, making it ineligible for a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/which-specific-provisions-in-a-franchise-agreement-raise-red-flags-for-undue-franchisor-co"},{"question":"How does the SBA determine if a franchise agreement grants the franchisor 'undue control' over the franchisee, impacting 7(a) eligibility?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-determine-if-a-franchise-agreement-grants-the-franchisor-undue-control-ov"},{"question":"Can a franchise system with a foreign-based franchisor be eligible for a 7(a) loan if the business operates in the U.S.?","url":"https://dealroom.so/for-lenders/questions/can-a-franchise-system-with-a-foreign-based-franchisor-be-eligible-for-a-7-a-loan-if-the-b"}],"related_terms":[{"term":"SBA Franchise Directory","url":"https://dealroom.so/glossary/sba-franchise-directory"},{"term":"Franchise Directory","url":"https://dealroom.so/glossary/franchise-directory"},{"term":"SBA's Franchise Directory","url":"https://dealroom.so/glossary/sba-s-franchise-directory"},{"term":"Claim on the SBA Guarantee","url":"https://dealroom.so/glossary/claim-on-the-sba-guarantee"},{"term":"Call on the guaranty","url":"https://dealroom.so/glossary/call-on-the-guaranty"},{"term":"SBA Franchise Team","url":"https://dealroom.so/glossary/sba-franchise-team"}],"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/for-lenders/questions/can-an-existing-franchise-location-that-is-not-currently-listed-on-the-sba-franchise-direc","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."]}