For SBA lenders
Short answer
A material change to collateral that requires prior SBA approval includes releasing significant collateral, substituting collateral of substantially lesser value, or any action that materially weakens the SBA's security position.
The Servicing and Liquidation Actions 7(a) Lender Matrix and SOP 50 57 specify that lenders have limited delegated authority for collateral actions. Any change that materially impacts the value, enforceability, or SBA's lien position on collateral will require prior SBA approval to maintain the guaranty.
A borrower requests to sell a piece of machinery that constitutes 30% of the loan's collateral value. The lender must seek prior SBA approval before agreeing to release the lien on this asset, as it represents a material reduction in collateral.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
Servicing and Liquidation Actions 7(a) Lender Matrix
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.
More on servicing actions
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