Overly intrusive SBA 7(a) lender questions for investors?

June 27, 2025

by a searcher in Fort Wayne, IN, USA

Dealing with some pushback from investors on an SBA 7(a) deal around being forced by the bank (who is claiming the direction comes from the SBA) about having to disclose all of their business holdings, percentage ownership, NAICS, EIN, mailing address to a bank when they're writing a simple 25-50k check on these type of self-funded search deals. Further, they're pushing back on the bank requiring them to hand over###-###-#### days of bank of their bank/brokerage statements for the "equity injection verification". One gentlemen doesn't have it as cash and was planning on liquidating some assets just before the capital call. These are all guys who are accredited investors and who have never participated in a deal like this. Anyone else deal with pushback on this?

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Reply by an investor
from New York University in New York, NY, USA

As an investor, I know it can be painful, but it's part of the process with the SBA deals. The banks have to follow the process - as ^redacted‌ mentioned, the banks need to check every box - not worth their time to cut corners. Regarding the equity injection verification - I go through this with every investment in an SBA deal as I don't keep money in a checking account waiting to be invested. The investors just need to show the paper trail over the past 3-4 months - the funds were in account X, then sold, then transferred to account Y. The need the statements for both accounts, the sale confirmation, the transfer confirmation, etc. I've done this with numerous banks - they will work with the investors and let them know what is needed. This typically happens directly between the bank and the investor, but if there is a breakdown you can always speak with the bank to get clarity on what they need so you can walk your investors through it.

Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA

Some of the additional detailed questions you are getting from minority investors are overkill and not required. You may want to consider switching directions from a lender perspective. As for the providing proof of liquidity and sourcing of capital, that is an SBA requirement. They will eventually need to provide that. But it can be received during the closing process and you can set it up where they provide the minimal amount of evidence possible directing to the Bank during closing. I would be happy to discuss and see if we can provide any assistance. You can reach me here or directly at redacted

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