As of midnight, the government went into full shutdown. This comes after the White House had indicated that they might be able to keep the government operational during any short-term lapse in funding if a deal was imminent.  However, in a memo from OMB to the various government agencies last night, the OMB Director made clear that all Agencies affected by the funding bills under consideration, including SBA, should shut down starting midnight. And NAGGL has confirmed that E-Tran processing was shut down effective just before midnight last night.

After Senate passage of the latest funding deal last night, the funding package now awaits House passage and as of publication, there is not a scheduled House vote yet. The expectation continues to be that this shutdown will remain short. Below is a reminder on the impact to 7(a) lending during a shutdown and NAGGL will keep you updated throughout this process. 

Here’s a rundown on the status of 7(a) Program actions during the, hopefully brief, shutdown – we will keep you posted if anything changes:   

  • E-Tran closed for new loan approvals BUT lenders can continue to process loans up to the point of submission to SBA.
  • NO loan increases.
  • NO reinstatements of cancelled loans.
  • NO new secondary market transactions – per guidance provided by SBA pre-shutdown:
    • The sale of SBA 7(a) loans into the Secondary Market is only continuing for those loans where all required sale documentation was received by the SBA fiscal and transfer agent (FTA) on or before 5PM ET on January 30.  
    • Assignees can continue to present SBA Form 1088, Secondary Market Assignment and Disclosure Form, and its related registered certificate for transfer to the FTA for SBA 7(a) Secondary Market Certificate Transfers, including Confirmation of Originator Fee transfers.
    • SBA 7(a) Pooling is suspended for the duration of the government shutdown. Upon restoration of appropriations and resumption of orderly operations, an eligible pool formation calendar would be published on the FTA Wiki. 
  • E-Tran is open for servicing actions (except increases and reinstatements).
  • SBA assistance is available for servicing and liquidation actions that are critical to protecting the government’s interests.
  • OCRM lender portal is open and the LLMS contract is continuing during shutdown.
  • FTA contract is continuing during the shutdown.
  • Disaster employees are not affected by the shutdown, so, actions such as EIDL subordinations are available.