Glossary · Reading the business
Credit standards
In short
The lender's criteria for assessing the borrower's ability and willingness to repay the loan. Your personal and business financial health will be scrutinized against these standards.
What it means in a deal
Lenders look at your FICO score, personal credit report, and the target business's cash flow and financial ratios. They need to see a track record of responsible debt management and sufficient business earnings to cover all loan payments. Your lender will guide you on meeting these benchmarks.
Official sources
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 Credit standards
- What constitutes prudent lending standards for SBA 7(a) underwriting regarding credit analysis?
- How does a lender document adherence to prudent lending standards in the underwriting credit memo?
- What specific documentation is required for a lender's independent credit analysis under prudent lending standards?
- How does the credit memo for a 7(a) loan demonstrate adherence to prudent lending standards?
- What specific requirements apply to the "prudent lending standards" for a lender's credit analysis in a 7(a) loan?
- What constitutes prudent lending standards for SBA 7(a) underwriting?
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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