# Can you get an SBA loan with defaulted student loans?

**Short answer:** It depends. A student loan is not a Prior Loss. But an applicant or guarantor with a federal nontax debt 90 days past due is ineligible. Exceptions include a repayment agreement paid as agreed. Source: SOP 50 10 8.1, Sec. A, Ch. 1, Para. E.

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Last checked: 2026-11-08

It can block you if the debt is a delinquent federal debt. SOP 50 10 8.1, Sec. A, Ch. 1, Para. E has two separate tests, and student loans are treated differently under each.

## Prior Loss

The definition of a federal loan for this test excludes a federal loan issued to an individual, such as a student loan. So a student loan default does not create a Prior Loss.

## Delinquent Federal Debt

A separate paragraph cites 31 CFR § 285.13. It bars an applicant or guarantor who owes an outstanding nontax federal debt in delinquent status. Supplemental guarantors are excepted. The SOP states no student loan carve-out here. A debt is delinquent when it has not been paid within 90 days of the payment due date, even if collection has stopped.

## When a debt is not delinquent

- The agency released you, accepted a compromise, or you cured the delinquency on acceptable terms.
- The debt is subject to, or was discharged in, a bankruptcy proceeding, and you are current on any court plan.
- You have a satisfactory written repayment agreement and are paying as agreed.
- The debt is in an administrative or judicial appeal.

## Next steps

Lenders must check Credit Alert Verification Reporting System (CAIVRS). If the debt is fully satisfied, the application can proceed. SBA does not routinely grant waivers of this rule.

## Sources

- [SOP 50 10 8.1, Sec. A, Ch. 1, Para. E, Prior Loss to the Government (about p. 24)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Sec. A, Ch. 1, Para. E, Delinquent Federal Debt (about pp. 25-26)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)