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Office of Capital Access | Resources
The Preferred Lenders Program (PLP)
The Preferred Lenders Program (PLP) is part of SBA's effort to streamline the procedures necessary to provide financial assistance to the small business community. Under this program, SBA delegates the final credit decision and most servicing and liquidation authority and responsibility to carefully selected PLP lenders. SBA, however, will continue to check loan eligibility criteria.
Lenders are considered for PLP status based on their record with SBA, and must have demonstrated a proficiency in processing and servicing SBA-guaranteed loans. In the event of payment default by the borrower and the need for enforced collections, the PLP lender agrees to liquidate all business assets before asking SBA to honor its guaranty.
How to Participate
A lender may be nominated by an SBA field office, or it may request a field office to consider it for PLP status.
The SBA field office will forward its recommendation to an SBA centralized loan processing center, which will submit its recommendation and supporting documentation to the Associate Administrator of Financial Assistance (AA/FA) for a final decision. In making its decision, SBA considers whether the lender:
Has the required ability to process, close, service and liquidate loans;
Has the ability to develop and analyze complete loan packages; and
Has a satisfactory performance history with SBA.
If the lender is approved, the D/FA designates the area in which it can make PLP loans. Before it can operate as a PLP lender, it must execute an SBA Form 1347, Supplemental Guarantee Agreement, which will specify a term not to exceed two years. When the agreement expires, SBA may: 1) recertify the lender for an additional term not to exceed two years, 2) recertify the lender for a shorter term, or 3) choose not to recertify the lender. Prior to recertification, SBA will review a PLP lender's loans, policies and procedures.
A PLP lender may request an expansion of the territory in which it can process PLP loans by submitting its request to a loan processing center. Because of the expanded authority and the expedited nature of the PLP program, certain loans cannot be processed under the PLP Program.
Contact your local district office for a listing of lenders with delegated processing authority.
For More Information
For more information and a complete description of the application process, consult SBA’s SOP 50 10 5(A).