October 27, 2026

Bob Coleman
Founder & Publisher

SBA Hot Topic Tuesday: SBA Clarifies Acquisition Rules, Corrects 7(a) Guaranty Fees and Expands ICAP

24-Month Owner-Buyout Test, New Quality-of-Earnings Flexibility and 250 Lenders Testing SBA’s New Platform

SBA clarified how lenders evaluate business acquisitions, calculate equity injections and document Quality-of-Earnings reviews during its October 20 Connect Call. 

Owner Buyouts Face a 24-Month Test

Individuals who have not been employees for 24 months cannot become the largest shareholder in an employee buyout. 

Transactions failing this test follow initial-acquisition credit standards, including applicable equity injection and Quality-of-Earnings requirements.

For qualifying owner buyouts, required equity injections are calculated on the business purchase price rather than total project costs.

Quality-of-Earnings Reports and Seller Guarantees

SBA will accept buyer-obtained Quality-of-Earnings reports if reviewed by the lender’s selected QoE vendor. Seller-prepared reports remain prohibited.

Other clarifications include:

• Sellers retaining less than 20% ownership may be released from their guaranty after 24 months if the loan has been current for the preceding 12 consecutive months.
• 7(a) Small and SBA Express loans may finance ownership changes, subject to Appendix 15 credit requirements.

Equity Injection, Working Capital and Collateral

When lenders reduce or eliminate equity injections for qualifying owner buyouts or business expansions, no dedicated permanent working capital may be added to that or another 7(a) term loan within 90 days.

Incidental closing proceeds resulting from rounding or closing-cost adjustments are limited to the greater of $10,000 or 0.5% of the loan amount.

Other changes include:

• Nonborrowed cash gifts qualify as unlimited equity sources.
• Education, advisory and applicant-paid agent fees cannot count as prepaid equity.
• 7(a) Small and Express lenders are not required to take available equity in other commercial real estate owned by qualifying co-borrowers, owners or guarantors.
• EV charging stations are ineligible businesses.

The 51% real estate rule allowing maturities up to 25 years remains available for qualifying non-acquisition loans, but not change-of-ownership transactions.

A separate exception permits 25-year maturities for acquisitions involving owner-occupied special-purpose real estate when at least 85% of total project costs are for real estate and the property is integral to the acquisition and continued operation of the business.

More Than 250 Lenders Testing ICAP

SBA Chief Information Officer Hartley Caldwell reported that more than 250 lenders have processed over 1,000 loans through the Intelligent Capital Access Platform pilot.

The new platform, lender.sba.gov, provides earlier eligibility and fraud checks, automated calculations, centralized document management and loan-status tracking.

SBA has also digitized guaranty sale processing and plans additional lender onboarding through year-end. The agency expects to expand ICAP into 504 lending and servicing.

SBA Correcting FY2027 Guaranty Fee Errors

SBA acknowledged incorrect upfront guaranty fee calculations for applications submitted October 1–15, 2026.

The system problem has been fixed, and SBA is correcting affected loans in E-Tran.

Lenders that do not see a correction should contact CAPS Questions to request an adjustment. SBA says lenders should continue closing affected loans while the agency corrects the fees in E-Tran.