SBA SOP 50 10 8, A.Ch1.F — BUSINESSES OWNED BY NON-U.S. CITIZENS
Verbatim text of SBA SOP 50 10 8 section A.Ch1.F (BUSINESSES OWNED BY NON-U.S. CITIZENS), effective 2025-06-01. 7 provision(s) quoted from the SOP PDF. SBA's own document page serves superseded editions, and the SOP is further amended by policy notices — read this with the notices that touch it.
Verbatim regulatory text
Verbatim provisions from SBA SOP 50 10 8, A.Ch1.F — BUSINESSES OWNED BY NON-U.S. CITIZENS — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
SOP 50 10 8 A.Ch1.F
F. BUSINESSES OWNED BY NON-U.S. CITIZENS SBA financing is limited to businesses with 100% direct and/or indirect owners and SBA- required guarantors (except as noted below) that are U.S. citizens, U.S. Nationals, or who are Lawful Permanent Residents (LPRs) (commonly referred to as “green card holders”), and comply with the requirements in this Paragraph. SBA Lenders must certify in E-Tran that no direct or indirect owner or guarantor is an Ineligible Person. No loan may be made if any direct or indirect owner is an Ineligible Person. “Ineligible Person” includes, but is not limited to, foreign nationals, those granted asylum, refugees, visa holders, nonimmigrant aliens under 8 U.S.C. § 1101(a)(15), those under Deferred Action for Childhood Arrivals (DACA), and undocumented aliens who are in the U.S. illegally. Six-month lookback: The Applicant business is ineligible if any Associate of the business commencing 6 months prior to the date of issuance of the SBA loan number is an Ineligible Person, unless the Ineligible Person completely divests their ownership interest prior to the date of issuance of the SBA loan number and severs any relationship with the Applicant (and any associated Eligible Passive Company and/or Operating Company) in any capacity, including being an employee (paid or unpaid), for the life of the 7(a) or 504 loan. If a direct or indirect owner of the Applicant is an Ineligible Person who is not an Associate of the Applicant business, the business is ineligible unless the Ineligible Person completely divests their ownership prior to the date of issuance of the SBA loan number; however, the Ineligible Person (except for an illegal alien) may be an employee (but not a Key Employee) of the Applicant business (i.e., the 6-month lookback only applies to an Ineligible Person who is an Associate of the Applicant business). Guarantors (including Supplemental Guarantors): If any guarantor (including an OC for a project structured as an EPC/OC) or direct or indirect owners of the required guarantor are Ineligible Persons, the Applicant is ineligible except as follows for limited guaranties. When a limited guaranty is required by SBA to support the pledge of jointly held required collateral, an Ineligible Person (except for an illegal alien) may provide a limited guaranty to support the pledge of jointly held required collateral. If an illegal alien co-owns the collateral with a direct or indirect owner, the Applicant is ineligible unless the illegal alien fully divests their ownership interest in the collateral before loan closing and disbursement of any funds. SBA Lenders are not required to complete the citizenship verification process in this section (Para. F) for those individuals who are providing a limited guaranty to support the pledge of jointly held required collateral. Illegal aliens may not be employees of the Borrower. For servicing requests (e.g., substitution of an owner or guarantor) the new individual may not be an Ineligible Person. The processing procedures will vary depending upon the status of the owners as assigned by the United States Citizenship and Immigration Service (USCIS) but, for all individuals who are not U.S. citizens or U.S. Nationals, as described in Paragraph 4 below, SBA requires verification of the individual’s immigration status through examination of the individual’s USCIS Form I-551 (551), Lawful Permanent Resident Card (commonly referred to as the “green card”) and submission of USCIS Form G-845 to SBA for verification by USCIS. 1. U.S. Citizens - Citizens born in an American territory: Generally, those born in an American territory are U.S. citizens. This includes but is not limited to the fifty U.S. states, the District of Columbia, Guam, Puerto Rico, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands, but does not include outlying possessions of the United States (i.e., American Samoa and Swains Island). 2. U.S. Nationals - People born in American Samoa and Swains Island are considered U.S. Nationals at birth but are not automatically U.S. citizens. 8 U.S.C. § 1408 and 8 U.S.C. § 1101(a)(29). When making a loan to a business owned by a non-citizen U.S. National, the SBA Lender must collect and retain evidence of the person’s status as a U.S. National (e.g., birth certificate or passport) and must enter the U.S. National’s Social Security Number on the application and into E-Tran. 3. Naturalized Citizens - Businesses owned by Naturalized Citizens are eligible and the naturalized citizens are not subject to any special restrictions or requirements. No further verification of status is required if an individual is reflected as a U.S. Citizen on the SBA application. 4. Lawful Permanent Residents (LPRs) – LPRs may be owners and/or guarantors of the business. LPRs may live and work in the U.S. for life unless their status is revoked through an administrative hearing. The USCIS Form I-551 (551), Lawful Permanent Resident Card, commonly referred to as the “green card,” is evidence of LPR status. USCIS has two versions of the 551: i. Resident Alien Card (issued through 1997); and ii. Permanent Resident Card. (This is the most recent version and has been issued since 1997.)
SOP 50 10 8 A.Ch1.F.i.ii.iii
iii. Because it can take up to a year for a newly arrived immigrant to receive a 551, new immigrants are issued an immigrant visa with a Customs and Border Protection (CBP) stamp evidencing their lawful permanent residence for a full year from the date the new immigrant entered the U.S. This visa with CBP stamp serves as evidence of LPR status, so long as the visa is not expired. Since 1997, USCIS has issued the 551 with a 10-year validity, at which time it expires and must be renewed. A 551 issued between 1979 and August 1989, however, does not have an expiration date. A person with a Permanent Resident Card with a 2-year validity is not eligible because a 2-year card is a temporary conditional card, and the individual must apply to remove the conditions in order to obtain a 10-year card. Replacing the 551 may be necessary if the 551 is lost, the individual changes his/her name, etc. Replacement of the 551 may take more than a year. The expiration of the immigrant’s 551 does not affect the LPR status of the immigrant. Acceptable forms of evidence when the 551 has been submitted to USCIS for replacement or renewal upon expiration include the following:
SOP 50 10 8 A.Ch1.F.i.i
i. Temporary I-551 stamps. A temporary stamp, issued by USCIS to replace lost or expiring 551s, either on the immigrant’s unexpired foreign passport (that reads “Upon endorsement, serves as temporary I-551 evidencing permanent residency for 1 year”);
SOP 50 10 8 A.Ch1.F.i.i.ii
ii. USCIS Form I-327, “Re-entry Permit,” issued to LPRs in lieu of a visa, which is valid for only 2 years (the I-327 is issued for LPRs who need to be overseas for longer than 1 year); or
SOP 50 10 8 A.Ch1.F.i.i.iii
iii. USCIS Form I-797, Notice of Action. Aliens with Conditional LPR status (those who married a U.S. citizen and were married for less than 2 years at the time of being granted LPR status) must file Form I-751 to remove conditional status within 90 days of their 551 expiration. LPRs awaiting approval of their I-751 should be issued Form I-797, which along with the expired 551, is proof of current LPR status. Please note that there are numerous types of Form I-797 (e.g., I-797A, I-797-B, I-797C, etc.). For purposes of removing conditional status, only I-797 is acceptable. SBA requires the 551 or an acceptable substitute be current at the time it is submitted with an application, or it will be returned and not processed. SBA Lenders processing a loan under delegated authority or through a Pilot Loan Program must have a copy of the current 551 or acceptable substitute prior to requesting a loan number. Verification of the status of an LPR is required if 6 months has elapsed since the last verification. 5. Documentation to evidence and verify the Applicant’s eligibility and any alien’s status. The SBA Lender must enter into E-Tran at least 81% of the Applicant’s direct and indirect owners, which includes entity and individual owners with direct or indirect ownership. SBA Lenders must also follow this process for guarantors and for servicing actions (e.g., for requests to substitute an owner or guarantor). The ownership percentage of married spouses and minor children must be combined. Additionally, the following applies: i. The individual must provide his or her alien registration number on the SBA loan application (SBA Forms 1919 or 1244). ii. SBA Lenders must obtain a copy of the individual’s USCIS documentation and maintain all documentation in the loan file. iii. SBA Lenders must request Document Verification from the Sacramento Loan Processing Center (SLPC). a) Uploaded into E-Tran as a single attachment: The SBA Lender submits a USCIS Form G-845, “Document Verification Request,” (G-845) (all 3 pages of the “Verification” form only – do not provide the Supplemental G-845 form) with supporting information to the SLPC. The SBA Lender must state on the G-845 that the request is for an SBA loan. After uploading the USCIS Form G-845 into E-Tran, the SBA Lender must send an email to [email protected] with the Applicant/Principal’s name (not the project name), SBA Lender name, and E-Tran application number to let SBA know the information has been uploaded into E-Tran. b) As required by USCIS, SBA will release information about the status of an alien to SBA Lenders or other non-governmental entities ONLY when a signed and dated authorization from the alien is attached to and submitted with the G-845 on that alien providing name, address, and date of birth. c) As required by USCIS, SBA accepts either of the following authorization statements:
SOP 50 10 8 A.Ch1.F.i.i.i
i) “I authorize the U.S. Citizenship and Immigration Services to release information regarding my immigration status to [name of SBA Lender], because I am applying for a U.S. Small Business Administration loan.” ii) “I authorize the U.S. Citizenship and Immigration Services to release alien verification information about me to [name of SBA Lender], because I am applying for a U.S. Small Business Administration loan.”
SOP 50 10 8 A.Ch1.F.i.i.iv
iv. As required by USCIS, all verification requests must include an authorization with the original “wet ink” signature of the alien for SBA to release information to SBA Lenders on the status of a verification. The original Document Verification Request (G-845) and authorization for release must be maintained by the SBA Lender in the Applicant’s file for review by SBA and USCIS, if requested. v. The authorization statement must not be on SBA or SBA Lender stationery. vi. The information provided to SBA by the USCIS system is intended solely for the purpose of determining eligibility for SBA financial assistance. This information is governed by the Privacy Act, 5 U.S.C. § 552(a)(i)(1), and any person who obtains this information under false pretenses or uses it for any purpose other than for determining eligibility may be subject to criminal penalties. SBA Lenders must receive verification of the status of each individual required to submit USCIS documents prior to submission of the application to SBA or, for delegated processing, prior to submission of the request for loan number. The SBA Lender must document the findings in the loan file and delegated SBA Lenders must retain the notification from the SBA in the Borrower’s loan file.
Operationalizing SBA SOP 50 10 8, A.Ch1.F — BUSINESSES OWNED BY NON-U.S. CITIZENS
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