The 7(a) Lender refinances only business debt that is and has been current (no payment more than 29 days late) for the last 12 months or the life of the loan, and never pays a creditor, including itself, positioned to sustain a loss or shift a potential loss to SBA. Eligible debt includes demand or balloon debt, debt above the SBA maximum rate, business credit card and HELOC debt with the Applicant's certification of exclusive business use, over-collateralized debt, revolving lines not being renewed or restructured, debt with a maturity unsuited to its purpose, change of ownership debt (seller debt only after 36 months current), and balance sheet debt whose interest appears on the business tax return; factoring agreements are excluded, and merchant cash advance type agreements qualify only once converted to a term loan amortizing for 24 months with no new agreements. Same-institution debt may be refinanced under PLP only without reducing the Lender's exposure or shifting loss, with a 36-month payment transcript and written explanation of late payments; the Lender refinances its own 7(a) loan only where a secondary market investor will not agree to modified terms or an increase is not possible; a 504 loan only with its Third Party Loan (or after that is repaid, for expansion), never the TPL loan alone. It excludes debt originally for an ineligible purpose (unless cured) and SBIC or NMVCC debt.
The graph holds this control, the 0 it maps to, and the evidence behind each claim, over MCP and REST.