SBA 7(a) Q&A
Short answer
If the seller withdraws from the sale agreement during the SBA loan underwriting process, the deal will typically fall apart, and the loan application will be withdrawn.
An SBA loan is specific to a particular transaction and business acquisition. If the underlying purchase agreement is terminated by the seller, there is no longer a transaction to finance, and the loan cannot proceed. Any fees paid may be non-refundable.
A buyer has a commitment letter for an SBA loan, but the seller receives a higher offer and terminates their agreement. The buyer's SBA loan application would then be canceled, and they would need to start a new application for a different business.
Insider move
Lenders understand that deals can fall through. They will cease processing the application upon notification of the terminated purchase agreement, often retaining any non-refundable fees for their work performed.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-13. 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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