For SBA lenders
Short answer
After selling the guaranteed portion, the originating lender (Holder) remains the servicer of the entire loan and is responsible for all servicing actions, including collections, reporting, and remitting payments to the secondary market investor.
The selling of the guaranteed portion transfers only the financial interest in that part of the loan, not the servicing responsibilities. The originating lender remains the 'Holder' in the SBA's eyes and is fully responsible for servicing the entire loan (both guaranteed and unguaranteed portions) in a prudent manner consistent with SBA policies.
A lender sells the guaranteed 75% of a $1,000,000 loan. The lender continues to collect monthly payments from the borrower, apply them, and then remit the appropriate pro-rata portion of principal and interest to the secondary market investor. They also handle any borrower requests, modifications, or defaults.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 56 - Lender Participation Requirements
SOP 50 57 - 7(a) Loan Servicing and Liquidation
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.
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