UNGUARANTEED LOAN SECURITIES: A COMPARATIVE MARKET ANALYSIS

Guidehouse is a public-sector advisory firm that provides loan servicing, technology modernization, and financial services for US Small Business Administration (SBA) loan programs. Guidehouse tasked a Capstone team to explore the possibility of a secondary market for the unguaranteed portions of the SBA’s 7(a) Loan Program. The team utilized a mixed-methods research approach that combined qualitative and quantitative methods, as well as primary and secondary sources. Its research involved four phases: literature review, semi-structured interviews, market analysis, and case studies. Based on its findings, the team focused on examining two structured finance products and their markets to determine which securitization would be better suited for the SBA’s 7(a) Loan Program: credit card asset-backed securities or middle market collateralized loan obligations. The team’s comprehensive report includes an infographic and recommendations for a product strategy for the unguaranteed portions of the SBA 7(a) Loan Program.