SBA 7(a) Q&A
Short answer
If a franchise is not on the SBA Franchise Directory, the lender must submit the franchise agreement and related documents to the SBA for a direct eligibility review.
The SBA maintains a Franchise Directory to streamline the eligibility review process. For unlisted franchises, the lender must provide the SBA with the franchise agreement and all exhibits. The SBA will then review these documents to ensure the franchise system meets its eligibility requirements, particularly regarding control and affiliation.
If you apply to purchase a unique regional franchise called 'Green Cleaners' and it's not on the directory, your lender will compile the franchise disclosure document (FDD) and agreement. They will then send it to the SBA for a specific eligibility determination, which can add time to the approval process.
Insider move
Lenders prefer franchises on the directory due to simplified eligibility. For unlisted franchises, they bear the responsibility of compiling and submitting comprehensive documentation to the SBA and addressing any questions that arise during the review, which requires additional time and effort.
SOP 50 10 - Lender and Development Company Loan Programs
13 CFR Part 121 - Small Business Size Regulations
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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