13 CFR 120.434 - What are SBA's requirements for loan pledges?
(c) The Lender has satisfactory SBA performance, as determined by SBA in its discretion. The Lender's Risk Rating, among other factors, will be considered in determining satisfactory SBA performance. Other factors may include, but are not limited to, on-site review/examination assessments, historical performance measures (like default rate, purchase rate and loss rate), loan volume to the extent that it impacts performance measures, and other performance related measurements and information (such as contribution toward SBA mission);
(e) The Lender must use the proceeds of the loan secured by the 7(a) loans only for financing 7(a) loans and for costs and expenses directly connected with the borrowing for which the loans are pledged;
(f) The Lender must remain the servicer of the loans and retain possession of all loan documents other than the original promissory notes;
(g) The Lender must deposit the original promissory notes at the FTA; and
(h) The Lender must retain an economic interest in and the ultimate risk of loss on the unguaranteed portion of the loans.