SBA loan basics
Short answer
It depends on the nature and recency of the criminal record. Certain serious felonies or crimes involving fraud can disqualify an applicant, especially if recent.
The SBA conducts criminal background checks on all principals (owners, officers, etc.). While minor offenses or very old convictions may not be disqualifying, certain felonies or offenses involving financial misconduct within a specific timeframe can lead to ineligibility.
An applicant with a felony conviction for fraud within the last five years would likely be deemed ineligible. Conversely, an applicant with a misdemeanor DUI from 15 years ago might still qualify, provided other eligibility criteria are met.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Criminal Justice Reviews for SBA Business Loan Programs - Final Rule
SBA Form 1919 - Borrower Information Form
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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