The U.S. Small Business Administration (SBA) introduced significant updates to its Standard Operating Procedure (SOP) 50 10 8, effective June 1, prompting lenders to reassess loan eligibility criteria across various sectors, notably retail, logistics, and construction. These changes aim to enhance financial integrity and ensure that SBA-backed loans are directed to businesses that meet stricter eligibility standards.

Key Changes in SOP 50 10 8 Affecting Loan Eligibility
1. Reinstatement of Traditional Underwriting Standards
The SBA has eliminated the “Do What You Do” underwriting framework, reinstating traditional underwriting criteria that were in place before January 2021. This shift requires lenders to apply more rigorous credit assessments, impacting how loans are evaluated across sectors. SBG Funding
2. Increased Minimum SBSS Score
The minimum acceptable Small Business Scoring Service (SBSS) score for 7(a) small loans has been raised from 155 to 165. This change affects borrowers in all sectors, including retail, logistics, and construction, necessitating stronger credit profiles for loan approval. SBG Funding
3. Restoration of the Franchise Directory
The SBA has reinstated the Franchise Directory, streamlining procedures to help lenders determine business eligibility for SBA loans. This is particularly relevant for retail businesses operating under franchise models. Starfield & Smith Attorneys at Law+2SBG Funding+2Doeren Mayhew+2
Sector-Specific Impacts
Retail Sector
Retail businesses, especially franchises, must now navigate the restored Franchise Directory to establish eligibility. The increased SBSS score requirement may pose challenges for small retailers with limited credit histories, potentially affecting their access to SBA-backed financing.Doeren Mayhew+2SBG Funding+2Starfield & Smith Attorneys at Law+2
Logistics Sector
Logistics companies, often characterized by significant capital expenditures and complex ownership structures, must adhere to the stricter underwriting standards and higher SBSS score thresholds. These changes may impact their ability to secure funding for expansion or equipment purchases.
Construction Sector
Construction businesses face notable changes under SOP 50 10 8. For loans above $350,000, full adherence to SBA construction protocols—including bonding or approved alternatives—is required. Additionally, the SBA now allows lenders more flexibility when underwriting self-managed projects, permitting cost justifications through various means, such as estimates from third-party construction management firms or internal teams. Partner Engineering and Science, Inc.
Preparing for the New Guidelines
To adapt to these changes, businesses should:
- Enhance Credit Profiles: Work on improving credit scores to meet the new SBSS requirements.
- Review Ownership Structures: Ensure that ownership aligns with SBA eligibility criteria, particularly concerning citizenship and residency status.
- Consult the Franchise Directory: Retail franchises should verify their status within the SBA’s Franchise Directory to confirm eligibility.Doeren Mayhew+1Starfield & Smith Attorneys at Law+1
- Document Construction Plans Thoroughly: Construction firms should prepare detailed project plans and cost estimates, utilizing the new flexibility in cost justification methods.Partner Engineering and Science, Inc.
Conclusion
The SBA’s updated SOP 50 10 8 introduces stricter loan eligibility criteria, compelling lenders and businesses in retail, logistics, and construction to reassess their financing strategies. By understanding and adapting to these changes, businesses can better position themselves to secure SBA-backed loans under the new guidelines.
Take the Next Step with BoomerBiz Loans
Ready to elevate your entrepreneurial journey? BoomerBiz Loans specializes in supporting baby boomer business acquisitions, offering a streamlined 3-step loan application process for fast approvals within 24–48 hours.
With competitive low-interest rates, flexible terms, and loans up to $10M, we’re here to assist both first-time buyers and experienced business owners.
Don’t let funding be a hurdle to your success. Start Your Loan Application today and join the ranks of successful entrepreneurs who’ve experienced the BoomerBiz advantage.