New SBA Citizenship Ruling

March 12, 2025

by a searcher from Harvard University in Boise, ID, USA

We are 3 weeks out from closing on a deal with the SBA. This new ruling threw an absolute wrench in our deal. My business partner is on a TN Visa and has a SSN. We have purchased via SBA in the past, but now this new ruling looks like we are going to be ineligible regardless of the amount of ownership he has on the business. From what I have heard from our lender, if he owns even 1% of the business, we are ineligible. At the same time, I am not confident from this lender that they fully understand the ruling.

Another lender we are engaged with is stating that as long as he is under 20% ownership, we can be approved.

Are there any SBA experts out there than better understand this new ruling, and can verify if one of these statements is true?

Reply by a professional
from Bishop's University in Moncton, NB, Canada

TN visa does not lead to permanent residency or citizenship. So, I think your deal is in trouble.

Reply by a lender
from Berkeley College in Chicago, IL, USA

nder SBA Policy Notice###-###-#### , only the following individuals may qualify as beneficial owners of a business financed with an SBA loan: ✅ U.S. Citizens ✅ U.S. Nationals from American Samoa ✅ Lawful Permanent Residents (LPRs) with completed USCIS processing Who Is No Longer Eligible? The new policy excludes several categories of individuals who were previously eligible for SBA-backed financing, including: ❌ Foreign Nationals ❌ Visa Holders (including those on work or investor visas) ❌ DACA Recipients ❌ Asylum Seekers & Refugees ❌ Undocumented Individuals Additionally, foreign investors can no longer hold any ownership stake in an SBA-financed business. This is a major shift from previous rules, which allowed up to 49% of a business to be owned by non-citizens or non-green card holders.

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