Glossary · People and paperwork
In short
This means exercising control over a business even without formal legal ownership. The SBA looks for this to identify all individuals who should be subject to eligibility rules and personal guaranties.
The SBA scrutinizes arrangements where an individual or entity has significant influence or control over the borrower, despite not holding 20% or more formal equity. If you have "negative control" or common management with another business, the SBA may consider you a de facto owner, triggering affiliation rules and requiring a guaranty.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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