Glossary · The loan itself
In short
Certain business types or activities that the SBA will not fund, such as passive investments or businesses engaged in illegal activities. If your target business has an ineligible activity, it won't qualify.
The SBA has strict rules against funding businesses engaged in ineligible activities, including real estate investment, pyramid schemes, or certain financial speculation. During due diligence, verify that the target business does not conduct any of these activities, as an ineligible business cannot receive a 7(a) loan.
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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