For SBA lenders
Short answer
A serious criminal offense generally includes felony convictions, probation, parole, or supervised release for felonies, and certain crimes of moral turpitude within specific look-back periods. This may make an applicant ineligible for an SBA 7(a) loan.
SBA regulations prohibit loans to applicants who are incarcerated, on probation, parole, or supervised release following a felony conviction. Additionally, applicants with certain felony convictions, including crimes involving fraud, dishonesty, or breach of trust, within a specified look-back period (e.g., 5 years for felonies, 1 year for misdemeanors for certain offenses), may be ineligible. Lenders must conduct character determinations.
A principal applying for a 7(a) loan was convicted of felony fraud seven years ago and completed probation five years ago. Because the probation ended more than five years ago, this specific felony conviction would not automatically trigger an ineligibility under current rules, but the lender must still assess character.
SOP 50 10 - Lender and Development Company Loan Programs
SBA Form 1919 - Borrower Information Form
Criminal Justice Reviews for SBA Business Loan Programs - Final Rule
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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