{"ok":true,"canonical_url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-confirm-a-franchise-is-listed-on-the-sba-franchise-directory","api_url":"https://dealroom.so/api/public/questions/how-does-a-lender-confirm-a-franchise-is-listed-on-the-sba-franchise-directory","question":"How does a lender confirm a franchise is listed on the SBA Franchise Directory?","topic":"Franchise Eligibility","audience":"lender","bot_mode":"lender","short_answer":"Lenders must check the official SBA Franchise Directory (or its equivalent list of eligible franchises) by searching for the specific franchise name and ensuring its status is 'eligible' or 'on the addendum'.","rule":"The SBA maintains a Franchise Directory to simplify eligibility determinations for franchises. If a franchise is listed as eligible, its standard franchise agreement has been pre-approved, reducing the lender's burden to review the agreement for problematic clauses that could violate SBA rules.","example":"A borrower applies for a loan to open a new 'Coffee Cloud' franchise. The lender navigates to the SBA Franchise Directory and searches for 'Coffee Cloud'. Upon finding it listed as 'Eligible', the lender can proceed with the franchise eligibility aspect of underwriting.","what_lenders_check":"Lenders must verify the exact franchise name and ensure the correct eligibility status is noted. Relying on an outdated or incorrect directory entry could lead to an ineligible loan.","required_facts":[],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","7(a) Loan Program Terms, Conditions, and Eligibility"],"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":"7(a) Loan Program Terms, Conditions, and Eligibility","url":"https://www.sba.gov/partners/lenders/7a-loan-program/terms-conditions-eligibility"}],"related_questions":[{"question":"What specific requirements apply to a franchise system for SBA 7(a) loan eligibility?","url":"https://dealroom.so/for-lenders/questions/what-specific-requirements-apply-to-a-franchise-system-for-sba-7-a-loan-eligibility"},{"question":"What is the lender's process for submitting an unlisted franchise agreement for SBA eligibility review?","url":"https://dealroom.so/for-lenders/questions/what-is-the-lender-s-process-for-submitting-an-unlisted-franchise-agreement-for-sba-eligib"},{"question":"How does the SBA define 'undue control' by a franchisor that could render a franchise ineligible for 7(a) financing?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-define-undue-control-by-a-franchisor-that-could-render-a-franchise-inelig"},{"question":"What issues in a franchise agreement typically lead to a determination of 'undue control' by the franchisor?","url":"https://dealroom.so/for-lenders/questions/what-issues-in-a-franchise-agreement-typically-lead-to-a-determination-of-undue-control-by"},{"question":"What process must a lender follow if a franchise applicant's agreement is not listed on the SBA Franchise Directory?","url":"https://dealroom.so/for-lenders/questions/what-process-must-a-lender-follow-if-a-franchise-applicant-s-agreement-is-not-listed-on-th"},{"question":"What specific provisions in a franchise agreement, if present, would render a franchise ineligible for 7(a) financing?","url":"https://dealroom.so/for-lenders/questions/what-specific-provisions-in-a-franchise-agreement-if-present-would-render-a-franchise-inel"}],"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":"Franchise eligibility requirements","url":"https://dealroom.so/glossary/franchise-eligibility-requirements"},{"term":"Franchise Eligibility Review","url":"https://dealroom.so/glossary/franchise-eligibility-review"}],"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/how-does-a-lender-confirm-a-franchise-is-listed-on-the-sba-franchise-directory","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."]}