Glossary · Reading the business
Controlling interest(Majority ownership)
In short
Ownership of enough shares or voting power to dictate a company's policies and management. For an SBA loan, the buyer typically needs to acquire at least 51% of the business to demonstrate control.
What it means in a deal
You must acquire a controlling interest in the business to be eligible for an SBA 7(a) loan. This usually means at least 51% ownership. The SBA defines control broadly, including direct or indirect power to direct management or policies. All owners with a 20% or more stake are generally considered key principals and must personally guarantee the loan.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Controlling interest
- What are the specific conditions for a seller to retain a passive, non-controlling minority stake in an SBA 7(a) acquisition?
- What happens to the interest rate on an SBA 7(a) loan if general market interest rates go down significantly?
- Can a full standby seller note be interest-bearing if interest is deferred until after the SBA loan is repaid?
- What is the difference between a fixed interest rate and a variable interest rate on an SBA 7(a) loan?
- How are SBA 7(a) loan interest rates determined?
- What defines 'insurable interest' for a business life insurance policy?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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