For SBA lenders
Short answer
A 7(a) lender may take certain material servicing actions without prior SBA approval, such as approving a one-time principal deferment for up to 6 months, approving a change of ownership in the borrower's legal entity if it doesn't affect eligibility, or releasing non-essential collateral below specific thresholds.
SBA delegates certain servicing authority to lenders under 'Lender's Credit Authority' (LCA) to streamline loan administration. The Servicing and Liquidation Actions 7(a) Lender Matrix specifies which actions do not require prior SBA approval. These are generally actions deemed low-risk or necessary for prudent loan management, provided they adhere to all SBA policies and prudent lending standards.
A borrower for a $800,000 7(a) loan experiences a temporary cash flow crunch and requests a principal-only deferment for three months. The lender reviews the request, determines it's reasonable and within the SBA's delegated authority for principal deferments, and approves it without seeking prior SBA approval, documenting the decision in the loan file.
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.
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