For SBA lenders
Short answer
Identity of interest affiliation occurs when two businesses, though not formally linked, share common interests such that one can exercise control over the other, particularly among close relatives or entities with financial ties.
The SBA's 'identity of interest' rule states that if individuals or entities with common investments, economic dependency, or familial relationships (e.g., spouses, parents, children, siblings) have identical or substantially identical business or economic interests, and one can exercise control or have a strong incentive to do so, they may be deemed affiliated. This is a rebuttable presumption that lenders must assess.
A borrower applies for a 7(a) loan. Her brother owns a major supplier to her business, accounting for 70% of her COGS. Given the close familial relationship and significant economic dependency, the lender must investigate potential 'identity of interest' affiliation.
SOP 50 10 - Lender and Development Company Loan Programs
13 CFR Part 121 - Small Business Size Regulations
Affiliation and Lending Criteria 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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