For SBA lenders
Short answer
Yes, a franchise not listed on the SBA Franchise Directory can still be financed if the lender submits the franchise agreement and related documents for a review to determine eligibility.
While the SBA Franchise Directory lists pre-approved franchise systems, a franchise not on the list can still be eligible. The lender must submit the franchise agreement, disclosure document, and any other relevant agreements to the SBA for a review to ensure it meets all eligibility requirements, particularly concerning the 'control' clause which stipulates that the franchisor cannot have undue control over the franchisee's operations.
A borrower applies for a loan to open a new emerging franchise concept not yet on the directory. The lender gathers the Franchise Disclosure Document (FDD) and the Franchise Agreement and submits them to the SBA for a formal review of eligibility.
Insider move
Lenders must be diligent in their review of franchise agreements to identify any ineligible clauses, particularly those granting excessive franchisor control. The SBA's review process can add time to the loan approval timeline, and the loan may be denied if the agreement is deemed non-compliant.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
SBA Document Search
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
More on franchise eligibility
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