Glossary · The loan itself
Prior Approval
In short
Specific actions or changes related to an SBA loan that require the lender to obtain explicit permission from the SBA beforehand. This ensures compliance with program rules.
What it means in a deal
Post-closing, certain actions like a change in ownership, assumption of the loan by another party, or significant modifications to collateral may require your lender to seek prior approval from the SBA. This process ensures the SBA's guaranty remains valid and the loan still meets program requirements.
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 Prior Approval
- What servicing actions require prior written SBA approval?
- Can a lender approve a deferment period without prior SBA approval?
- Which servicing actions can a 7(a) lender take without prior SBA approval?
- Can a lender approve a material change to collateral without prior SBA approval?
- What servicing actions can a 7(a) lender take without prior SBA approval?
- What specific types of collateral releases can a lender execute without prior SBA approval?
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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