SBA Form 1919, the Borrower Information Form, is the questionnaire an SBA 7(a) lender uses to confirm that the business and the people behind it are eligible under SBA's rules (SOP 50 10 8). The business completes it, and so do its owners of 20% or more and its key officers and managers. It asks about ownership, other businesses, prior government loans, criminal history, pending charges and who is being paid to help with the loan. Answer every question for yourself, disclose rather than guess, and attach a short explanation to any yes.
- Full name
- SBA Form 1919, Borrower Information Form
- Used for
- SBA 7(a) loans, including SBA Express; ask the CDC which forms a 504 loan uses
- Completed by
- The applicant business and each of its associates: owners of 20% or more, officers, managers and guarantors
- Purpose
- Eligibility, character and conflicts under SOP 50 10 8
- Kept by
- The lender, in the loan file SBA can review
- Biggest risk
- An inaccurate answer: false statements to SBA are a federal offense
What the form is for
An SBA lender makes two decisions about every 7(a) loan: whether the loan is a sound credit, and whether it is eligible for SBA's guaranty. Form 1919 serves the second. SBA's guaranty is only good if the loan met the program's rules when it was made, and many of those rules are about people: who owns the business, what else they own, whether they have left the government with a loss before, and whether any of them is facing criminal charges. The form puts those questions to each person in writing and gets a signature on the answers.
The lender keeps the signed forms in its file and runs its own checks against them, including SBA's and other federal agencies' records of delinquent government debt. If SBA later reviews the loan, often because it has gone bad and the lender is asking SBA to honor the guaranty, the 1919 is one of the first documents it reads. An answer that turns out to be wrong can cost the lender its guaranty, which is why lenders take the form more seriously than borrowers expect. The rules behind it are in SBA SOP 50 10.
Who completes it
The business fills in the company sections. Then each associate of the business answers the personal questions for themselves. Your lender will confirm the list for your deal, but it generally runs as follows.
| Person | Completes the personal questions? | Why |
|---|---|---|
| Each owner of 20% or more | Yes | Every 20% owner also guarantees the loan, and SBA's eligibility rules reach them directly |
| Officers, directors, general partners, managing members | Yes | They control the business whatever their ownership |
| A hired manager who runs day-to-day operations | Yes, usually | SBA looks at who actually runs the company |
| Any other guarantor | Yes | A guarantor's history matters to the guaranty |
| Owners below 20% with no management role | Sometimes | The lender may ask, particularly if ownership is split to stay under 20% |
| The seller, in an acquisition | No, once fully bought out | The seller is not an associate of the buyer's business; a seller keeping a stake in a partial buyout is |
In an acquisition, the applicant is usually the buyer's new company, so the questions go to the buyer, the buyer's partners and any investor holding 20% or more. A buyer who brings in investors should expect each of them to answer the form, sign a personal financial statement and guarantee the loan. See buying a business with partners or investors.
The questions that cause problems
Most of Form 1919 is routine: names, addresses, ownership percentages, the loan request. The trouble is concentrated in a handful of questions, and they are the ones people answer too quickly.
| Question area | What it is getting at | What a yes leads to |
|---|---|---|
| Pending criminal charges, incarceration, parole or probation | SBA's character rules: a business is ineligible while an associate is in these situations | Usually a pause until the matter is resolved; the lender cannot waive it |
| Criminal history the current form asks about | Disclosure of past matters within the form's scope | Records and an explanation; the lender judges it under the current SOP |
| Prior SBA or other federal loans | Whether any caused a loss to the government, or is delinquent now | A prior loss can make the business ineligible; delinquent federal debt must be brought current |
| Suspension or debarment from federal programs | Whether anyone is barred from doing business with the government | Generally ineligible while it lasts |
| Other businesses owned or controlled | Affiliation: SBA counts affiliates' size, and some affiliates must also guarantee or be reviewed | A list of affiliates and, often, their financial statements |
| Ties to SBA staff, Congress or federal employees | Conflicts of interest | Additional SBA review before the loan can proceed |
| Bankruptcy and pending lawsuits | Financial and legal exposure | Documents and an explanation for the credit file |
| Agents and fees paid for help with the loan | Anyone paid to package, refer or advise on the loan | An SBA Form 159 for each agent |
The form also asks about citizenship and residency. SBA's ownership eligibility rules on this have changed more than once recently, so ask the lender which rule applies at the time your application is taken rather than relying on what was true last year.
A disclosed problem is a question the lender can work through. An undisclosed one that surfaces later is a false statement, and it can end the loan and the guaranty.
How to answer accurately
- Read each question in full. Some reach further back than people assume, and several cover the associate personally and every business they own, not just the applicant.
- Each person answers for themselves. A buyer should not fill in a partner's form from memory. Each associate signs a certification about their own answers.
- When unsure, disclose and explain. A yes with a two-paragraph explanation and the court or agency record attached is routine for an experienced SBA lender. A no that a background check contradicts is not.
- Check prior federal debt before you apply. An old student loan in default, a prior SBA loan that was charged off, or a federal disaster loan in arrears will show up in the lender's screening. Knowing first gives you time to resolve it.
- Make it agree with everything else. The affiliates you list should match the businesses on your tax returns and your Form 413; the ownership percentages should match the entity documents; the agents you list should match the Form 159 disclosures.
- Update it if something changes. The lender will ask for re-certification if facts change before closing. A new charge or a new business interest after signing still has to be reported.
Management experience and the rest of the file
Form 1919 also collects information about the people who will run the business. For an acquisition, the lender wants to see that the buyer can operate what they are buying, and it reads the form alongside the owner's resume. That is why Transparent's SBA checklist asks for an owner resume: it supports the management experience the form describes, and it saves the lender a round of questions.
The rest of the SBA file sits around the 1919: business tax returns for two to three years, a P&L and balance sheet, a debt schedule with copies of notes being refinanced, personal tax returns and a personal financial statement for each 20%+ owner, and IRS Form 4506-C so the lender can verify the returns. In an acquisition, add the target's latest full year of figures and the letter of intent. Transparent builds the full lender package from those documents in a day once they are in; the 1919 itself is signed by the people it describes, on the lender's current version of the form.
Where eligibility questions lead
The form's affiliation question is the one most likely to change the shape of a deal rather than stop it. SBA adds together the size of the applicant and its affiliates when it tests whether the business is small, and it can require affiliates to guarantee. An owner with several companies should read SBA affiliation rules and size standards before applying.
The prior-loss and criminal questions are the ones most likely to stop a deal outright, at least for a time. If one of them applies, SBA may not be the right program yet, and a conventional lender, which is not bound by SBA's eligibility rules, may be. The differences are set out in SBA 7(a) vs a conventional loan for an acquisition.
Common questions
- Does an old conviction disqualify me from an SBA loan?
- Not by itself. SBA's rules focus on current situations such as pending charges, incarceration, parole or probation. A past conviction must still be disclosed where the form asks, and the lender evaluates it under the current SOP. Disclose it with the records and a short explanation.
- Do I complete Form 1919 if I own less than 20%?
- If you are an officer, director, managing member or key manager, usually yes. A passive owner under 20% may not need to, but the lender can ask, and often will if ownership looks arranged to stay under the threshold.
- Does the seller fill out Form 1919 in an acquisition?
- Not in a complete change of ownership, where the seller leaves the business. A seller who keeps a stake in a partial change of ownership is an associate of the business and is treated like any other owner.
- What happens if I answer a question wrong by mistake?
- Tell the lender as soon as you notice and sign a corrected form. The risk is not the correction; it is an inaccurate answer left in the file, which SBA can treat as a false statement and which can cost the lender its guaranty.
- Is Form 1919 used for SBA 504 loans?
- A 504 loan is applied for through a CDC, which collects the same eligibility information about owners, prior government debt and criminal history. Ask the CDC which SBA forms it needs for your application rather than assuming the 7(a) set carries over unchanged.