SBA SOP 50 10 8 SPARK Update

On June 1, 2025, the SBA's SOP 50 10 8 goes into effect. This update includes several modifications to SPARK to ensure alignment with the updated policies. Changes include a new version of the SOP, revised SBA eligibility logic, updated tooltips, and reinstated validations to support SBA compliance.

New SOP 50 10 8

All new SBA loan packages now default to SOP 50 10 8. Existing packages without an SBA Loan Number or SBA Authorization Date are automatically updated to SOP 50 10 8 (excluding non-delegated packages).

Franchise Directory Compliance

The SBA Franchise Code is now required for all franchise borrowers prior to E-Tran submission. The SBA published a new version of the Franchise Directory effective May 28, 2025. We have updated SPARK to reflect updated information in the latest Directory.

Small Loan Definition Updated for SLA Scoring

• SLA Scores are now restricted to loans of $350,000 or less.

• SLA Scores will no longer be visible for loans greater than $350,000 unless they were already scored.

• The default SLA SBA 7(a) Score Configuration's thresholds have been updated to reflect the 165 minimum SLA score and the new ranges are as follows:

  • Bad: 0 - 129

  • Neutral: 130 - 164

  • Good: 165 - 300

SBA Eligibility Franchise Section Restored

The Franchise Eligibility section is now visible and required for all SOP 50 10 8 loan packages.

SBA Eligibility "Credit Not Available Elsewhere" Section Updated

• The title of the SBA Eligibility section has been updated updated to match SOP 50 10 8 language (Credit Not Available Elsewhere).

• We've reinstated the question about access to federal funds from the applicant or related parties ("Is some or all of the loan available from Non-Federal sources related to the Applicant, including the liquidity of owners of 20% or more of the equity of the Applicant, their spouses and minor children, and the Applicant itself?"). Answering this question "Yes" results in an ineligible applicant. Credit memos using our standard templates will automatically include the answer to this question.

SBA Eligibility "Required Guarantors" Ownership Threshold Verbiage Updated

The verbiage included in the Required Guarantors section of General Eligibility has been updated to "The 20% threshold includes a spouse when the combined ownership of both spouses and minor children is 20% or more."

SBA Eligibility 7(a) Small Loan Updated

• The 7(a) Small Loan section has been updated to only apply to loans of $350,000 or less. Loans on prior SOP versions will continue to show the 7(a) Small Loan section if it was relevant.

• The minimum SLA score is now 165.

SBA Eligibility Refinance Updates

• The "Will refinancing include payments to creditors in a position to sustain a loss due to either an inadequate collateral position or low or deficit net worth" question will now trigger a failure status if answered "Yes". Providing an explanation is no longer relevant. Loans on prior SOP versions will continue to behave as they did at the time of completion.

• Two new refinance rules exist to ensure that Merchant Cash Advance and Factoring Agreement debt types cannot be refinanced by an SBA loan. If either of these debt types are being refinanced the Refinance section will have a status of "Fail".

SBA Eligibility International Trade Updates

• The country restriction tooltip no longer specifically lists prohibited countries.

• Question 7 has been updated for the new SOP:

  Lender will do one of the following:

  1. Take a first lien on the assets financed with IT loan proceeds on other assets of the Applicant.

  2. Take a second lien on the property or equipment financed by the IT loan or on other assets of the Applicant, if the SBA determines that the second lien provides adequate assurance of the payment of the loan.

• A new information alert has also been added to Question 7: IT loans may not be processed under a Lender's PLP authority when the IT loan will not have a first lien on the assets being financed.

Ownership Threshold Increased to 100%

E-Tran now requires 100% ownership for all direct and indirect owners of the applicant business. To comply with this change:

• SPARK's SBA Ownership Validation has been updated to enforce 100% ownership during stage change validation.

• Lenders must now include 100% of ownership when submitting to E-Tran.

Support for Documenting Merchant Cash Advance and Factoring Agreement Debt Types

Both lenders and applicants can choose Merchant Cash Advance or Factoring Agreement as a type of debt for a business. When these debt types are selected, fields that are not relevant are disabled and not required (e.g., rate type, term, interest rate, and "Is debt guaranteed by the government"). If either of these debt types are being refinanced by an SBA loan, the loan will fail SPARK's SBA Eligibility checks.

Hazard Insurance Tooltips Updated

The tooltips for both Real Estate and Personal Property Hazard Insurance have been updated to reflect revised SBA guidance.

SBA Knowledge Assistant Updated

The SBA Knowledge Assistant now references SOP 50 10 8.

Small Loan Strategy Updated

The "Small Loan Strategy" used to generate fees, tasks, conditions, and documents now uses $350,000 or less as the threshold.

Large Loan Strategy Updated

The "Large Loan Strategy" used to generate fees, tasks, conditions, and documents now uses greater than $350,000 as the threshold.

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