SBA loan basics
Short answer
It depends; a misdemeanor might not automatically disqualify you, but the SBA and lenders will review the nature and recency of the offense.
The SBA conducts a criminal history review for all principals. While felonies, especially recent ones, are often disqualifying, misdemeanors are assessed on a case-by-case basis. The SBA considers the type of offense, how long ago it occurred, and whether it involved financial fraud or breach of trust. Minor, old, non-financial misdemeanors are less likely to be an issue.
A borrower with a misdemeanor for a minor traffic offense from 10 years ago would likely be eligible. However, a recent misdemeanor for embezzlement might lead to disqualification.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
SBA Form 1919 - Borrower Information Form
Criminal Justice Reviews for SBA Business Loan Programs - Final Rule
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.
More on eligibility & criminal history
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