SBA lending has gone through some of the biggest updates we’ve seen in years.
Between the new SOP 50 10 8 rules that kicked in mid-2025 and fresh changes for fiscal year 2026, today’s SBA borrower faces a very different landscape than just a couple of years ago.
From our home base in San Diego, we are seeing these changes impact local HVAC companies, retail shops, and manufacturers, but these federal shifts apply to every entrepreneur seeking capital across the United States. Whether you’re looking at an acquisition, working capital, or a refinance in 2026, these changes will directly impact your eligibility.
Key SBA Loan Changes Borrowers Will Feel
1. Stricter Underwriting: The Return of “Prudent Lending”
The “do what you do” philosophy of the last few years is officially over. The SBA has reinstated more rigorous credit standards to ensure program stability.
- Higher Credit Score Minimums: The threshold for small loans has increased from 155 to 165.
- Cash Flow Scrutiny: Lenders must now underwrite SBA loans with the same discipline as conventional commercial loans.
- The $350k Shift: The “Small Loan” threshold was lowered from $500,000 back to $350,000, meaning mid-sized deals now require full, standard 7(a) underwriting.
2. Equity Injection: 10% is the New Baseline
The days of nearly zero-down acquisitions are gone. For startups and changes of ownership, a 10% minimum equity injection is now a hard requirement.
- Seller Debt: Seller notes can only count toward that 10% if they are on full standby (no payments) for the life of the SBA loan.
3. Collateral Requirements are Tighter
In a major shift, the threshold for requiring collateral has dropped from $500,000 to just $50,000. While this creates more paperwork for smaller loans, it provides a clearer path for lenders to approve deals that were previously deemed too risky.
4. Fees are Back (With One Massive Exception)
The temporary fee relief from previous years has expired. Standard 7(a) guaranty fees are back for most—unless you are a manufacturer.
- The Manufacturing Bonus: To support the “Made in America” initiative, the SBA is waiving upfront fees for small manufacturers (NAICS 31-33) through September 30, 2026. This can save a business tens of thousands in closing costs.
2026 Program Highlights: 7(a) and 504 Updates
- SOP 50 10 8: This new standard operating procedure clarifies change-of-ownership rules and tightens how “Credit Elsewhere” is documented.
- Franchise Directory: The official directory is back, streamlining the process for franchisees—provided their brand has signed the new master certification.
- Size Standards: The SBA has proposed inflation-based increases to size standards, allowing more “mid-sized” firms to still qualify as “small” for federal programs.
What This Means for You in 2026
If you’re planning to borrow this year, preparation is your greatest leverage. Whether you are an HVAC owner in Chula Vista or a manufacturer in Chicago, the rules are the same:
- Bring Real Equity: Plan for at least 10% cash-on-hand for acquisitions.
- Clean Your Books: With the return of strict underwriting, clean tax returns and realistic projections are no longer “optional”—they are your ticket to an approval.
- Watch the Calendar: Manufacturers have until September 30, 2026, to take advantage of the zero-fee window.
Expert Take: For well-qualified borrowers, these updates are actually good news. Strong operators with clean books now face less competition from “edge” deals that would have passed under looser rules.
Take the Next Step
Navigating these new regulations doesn’t have to be a solo effort. Whether you are looking for a standard term loan up to $750,000 or an SBA loan up to $5,000,000, we provide a streamlined process to help you find the right fit for your business goals.
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