What changed in SBA refinancing rules on October 1, 2026?
Short answer
SOP 50 10 8.1 let some merchant cash advances be refinanced and allowed Preferred Lender Program (PLP) processing of non-SBA same-institution debt. It also lengthened the seller note waiting period. Factoring stays ineligible (App. 14, compared with SOP 50 10 8).
SOP 50 10 8.1 took effect October 1, 2026, for applications SBA receives on or after that date (SBA Information Notice 5000-882227). It moved 7(a) refinancing into Appendix 14 and changed several rules.
Changes we found by comparing the two SOPs
- Merchant cash advances. SOP 50 10 8 barred them. Appendix 14, Paragraph A.3 now allows a refinance after conversion to a term loan and a set amortization period.
- Same-institution debt. SOP 50 10 8 required non-delegated processing. Non-SBA same-institution debt may now go through PLP.
- A lender's own 7(a) loan. SOP 50 10 8 required non-delegated processing. Delegated processing is now allowed in the same two cases (App. 14, Para. A.4.f).
- Seller notes. The old waiting period was 24 months. Now a note can be refinanced after it has been in place and current for 36 months.
- Payment test. The text now says the new payment is measured against existing installments "in aggregate."
- Written analysis. The old list asked why the debt was not on reasonable terms. The new list drops that item.
What did not change
Factoring stays ineligible. The look-back for current payments and the 29-day definition are the same. Debts to an Small Business Investment Company (SBIC) or New Markets Venture Capital Company still cannot be refinanced.
Applications in the pipeline
Applications submitted through September 30, 2026 stay under SOP 50 10 8. This comparison is ours, not SBA's. Read both documents before relying on it for a specific loan.
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