SBA 7(a) Q&A
Short answer
Yes, but the lender must review the franchise agreement to ensure it meets SBA eligibility requirements before approval.
While the SBA maintains a Franchise Directory for pre-approved agreements, a franchise not on the list is not automatically ineligible. The lender must submit the franchise agreement to the SBA for review to ensure it complies with SBA requirements, particularly regarding control and affiliation. If the agreement is acceptable, the loan can proceed.
You want to buy a 'New Burger Joint' franchise, but it's not on the SBA Franchise Directory. The lender will send the franchise agreement to the SBA for a review to confirm that the franchisor does not exercise undue control over your business, ensuring eligibility for a $700,000 acquisition loan.
Insider move
Lenders need to ensure the franchise agreement does not impose terms that limit the borrower's control over their business, such as unreasonable termination clauses or excessive control over operations, which could trigger affiliation or make the business ineligible.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. 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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