{"ok":true,"canonical_url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-a-franchise-s-current-listing-status-on-the-sba-franchise-directo","api_url":"https://dealroom.so/api/public/questions/how-does-a-lender-verify-a-franchise-s-current-listing-status-on-the-sba-franchise-directo","question":"How does a lender verify a franchise's current listing status on the SBA Franchise Directory?","topic":"Franchise eligibility","audience":"lender","bot_mode":"lender","short_answer":"Lenders verify a franchise's listing status by searching the official SBA Franchise Directory website and reviewing the current Franchise Agreement Addendum or Negotiated Addendum.","rule":"The SBA maintains an online Franchise Directory that lists eligible franchise systems. Lenders must check this directory. If a franchise is listed, the specific addendum (SBA negotiated or approved standard) that the borrower must execute will be linked, which must be incorporated into the franchise agreement.","example":"A borrower applies for a 7(a) loan to purchase a sandwich shop franchise. The lender navigates to the SBA Franchise Directory online, searches for the franchisor, confirms its listing, and downloads the required SBA Addendum, ensuring it is properly executed by the borrower and franchisor.","what_lenders_check":"Failure to properly verify the franchise's eligibility or ensure the correct SBA Addendum is used can render the loan ineligible or lead to a guaranty denial. It is a critical early eligibility check.","required_facts":["Franchise Directory","Listing status","Franchise agreement","SBA Addendum","Verification"],"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":"Can an existing franchise location that is not currently listed on the SBA Franchise Directory be eligible for a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/can-an-existing-franchise-location-that-is-not-currently-listed-on-the-sba-franchise-direc"},{"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"}],"related_terms":[{"term":"SBA's Franchise Directory","url":"https://dealroom.so/glossary/sba-s-franchise-directory"},{"term":"SBA Franchise Directory","url":"https://dealroom.so/glossary/sba-franchise-directory"},{"term":"Franchise Directory","url":"https://dealroom.so/glossary/franchise-directory"},{"term":"SBA Lender status","url":"https://dealroom.so/glossary/sba-lender-status"},{"term":"Claim on the SBA Guarantee","url":"https://dealroom.so/glossary/claim-on-the-sba-guarantee"},{"term":"Preferred Lender Status","url":"https://dealroom.so/glossary/preferred-lender-status"}],"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-verify-a-franchise-s-current-listing-status-on-the-sba-franchise-directo","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."]}