Can an SBA loan be increased after approval?

“All loan increases, regardless of disbursement status, are subject to statutory, administrative, and program maximums and must be approved by SBA.

“Standard 7(a) (including International Trade), 7(a) Small Loan, EWCP, PLP, PLP-EWCP, SBA Express, and Export Express term loans: If the request for an increase is more than 20% of the original loan amount or is more than18 months after the original approval date of the loan, for loans that were processed under non-delegated procedures, the Lender must request approval from SBA and must include with its request its analysis showing that the purpose of the increase is the same as the original purpose of the loan and that the Borrower’s cash flow can support the increased payment amount. For delegated loans, the Lender must document the same analysis and retain it in Lender’s loan file.

“Must include an analysis of appropriate credit and risk factors consistent with the procedures the Lender uses for its similarly-sized, non-SBA guaranteed commercial loans if the increase is above 33% of the original loan amount.

“Approval of the requested increase in the SBA Loan System will constitute SBA’s prior written consent.

“Note: 7(a) Small Loans may only be increased up to $350,000. If the 7(a) Small loan is increased above $350,000, it becomes a Standard 7(a) loan and must follow the requirements in Chapter 1 of this section.

“The additional Upfront Fee associated with the increase must be paid electronically within 30 days from the date the increase was approved, or the total loan guaranty will be cancelled.

“For an increase or decrease in the amount of an approved loan, the 327 action must clearly support the need for the change in the amount and address the effects on repayment ability, collateral and jobs created or retained. The 327 action must also provide the revised breakdown of the private sector lender, debenture, and Applicant’s injection, including a revised use of funds.

“Neither the amount nor the maturity of a loan can be modified after the debenture closing has been completed.

“Approval of the requested increase or decrease in the SBA Loan System will constitute SBA’s prior written consent.

“An ALP Express Loan may not be increased over $500,000. Any increase above $500,000 would require the ALP Express Loan to be cancelled and resubmitted as a non-delegated loan through SLPC.