Breaking SBA Policy Update Effective June 1st - What You Need to Know 

SBA Loan Rule Changes Are Here: Insights from Brad

Watch our latest video where Brad Hettich, President of Commercial Lending X, breaks down the sweeping new SBA 7A policy changes going into effect on June 1, 2025. In this timely update, Brad explains how these changes could significantly impact small business lending—tightening eligibility, equity requirements, and underwriting criteria.

Brad emphasizes that these changes, while extensive, largely reverse policies from the previous administration, returning to more conservative SBA practices. While some updates add clarity, others present new challenges for borrowers, investors, and lenders alike. As Brad notes:

“These changes were much deeper than anyone anticipated. Lenders and borrowers alike need to take note—especially those relying on flexible structures and investor-backed financing.”

Brad also underscores the urgency of adapting quickly:

“If you’re looking to lock in financing under the old rules, you need to act now. Otherwise, prepare for more documentation, tighter restrictions, and increased scrutiny.”

Despite the shake-up, Brad remains committed to guiding borrowers through the evolving landscape. The video below covers what you need to know to prepare, plus our summary highlights the most impactful changes to SBA lending policy. Click below to watch the full video: 

📌 Key Changes Include:

• New restrictions on foreign ownership and undocumented employees

• SBA Small Loan limit reduced from $500K to $350K

• Franchise Directory reinstated—compliance deadline: July 31, 2025

• Minimum 10% equity required for business startups

• Return of the “Credit Elsewhere” test and stricter liquidity evaluations

• Stricter rules for partial business acquisitions and co-borrower requirements

• Borrowed equity must be repaid from outside income sources

• Life insurance now mandatory on unsecured loans over $350K

• And more...

👉 To explore the full list of changes, read more on SBA Policy Changes Effective June 1st, 2025.

Update as of May 1, 2025 - Bipartisan Bill to support manufacturing which includes an increase in the SBA loan limits for manufacturing companies from $5 million up to $10 million for both the SBA 7A and 504 loan programs is continuing to proceed through Congress.  We will get you an update as we learn more, and certainly if it is approved.  

About Commercial Lending X

CLX is a small business that specializes in helping other business owners get the business loans and financing they need to be successful.  To learn more about CLX and the services we provide please check out our website at www.commerciallendingx.com.  

If you would like to discuss financing options for your next project, please reach out to us by clicking the Contact Us Link Below.