The following requirements are normally required by SBA for all business loans:
(a) Personal guarantees. Holders of at least a 20 percent ownership interest generally must guarantee the loan. When deemed necessary for credit or other reasons, SBA or, for a loan processed under an SBA Lender's delegated authority, the SBA Lender, may require other appropriate individuals or entities to provide full or limited guarantees of the loan without regard to the percentage of their ownership interests, if any.
(b) Appraisals. SBA may require professional appraisals of the applicant's and principals' assets, a survey, or a feasibility study.
(c) Hazard Insurance. SBA requires hazard insurance for 7(a) loans greater than $500,000 and for 504 projects greater than $500,000, on all collateral.
[61 FR 3235, Jan. 31, 1996, as amended at 82 FR 39502, Aug. 21, 2017; 88 FR 21085, Apr. 10, 2023]
Notes of Decisions
Cited in
3
cases (
1 in the last 5 years), 2003–2025 · leading case:
Lee v. LPP Mortg. Ltd., 2003 WY 92 (Wyo. 2003).
Lee v. LPP Mortg. Ltd., 2003 WY 92 (Wyo. 2003).
· cites it 2× “However, 13 C.F.R. § 120.160 (a) did not take effect until March 1, 1996.”
Oldham v. SBA (5th Cir. 2025).
· cites it 4× “Oldham argues that her personal guaranty is illegal, and therefore void, because the 2006 version of 13 C.F.R. § 120.160 and the SOP prohibited the Bank from requiring a personal guaranty from her.”
— 13 C.F.R. § 120.160(a) — 1 case
Lee v. LPP Mortg. Ltd., 2003 WY 92 (Wyo. 2003).
“However, 13 C.F.R. § 120.160 (a) did not take effect until March 1, 1996.”
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