Best Practices: SBA Form 159 Submission Changes

The SBA recently announced changes to the submission procedure for SBA Form 159 Fee Disclosure Form and Compensation Agreement (“Form 159”).  Lenders are required to submit Form 159 when a third party agent is paid by the SBA applicant or the SBA Lender in connection with an SBA loan application.  There are no substantive changes to Form 159.  There are only procedural changes regarding how to access and submit the Form 159. 

Lenders previously submitted Form 159 to the Fiscal Transfer Agent (“FTA”)/Colson Services via email at form159@colsonservices.com.  In order to improve the security and integrity of loan information and to promote standardization, starting April 5, 2021, Lenders will create and submit Form 159 using SBA’s Capital Access Financial System (CAFS).  If Lenders are not currently registered with CAFS, they will be required to set up an account with CAFS which can be done at https://caweb.sba.gov/.  Lenders will now set up and print Form 159 in the ETRAN Origination section of CAFS.  CAFS will not allow Lenders to print Form 159 if there are any errors or missing information.  Once fully completed, Lenders will be able to print Form 159 and have the applicant, Lender and third party agent sign the form.  

After the first disbursement, Lenders will be able to submit the signed Form 159 in the ETRAN Servicing section of CAFS.  Lenders are required to upload supporting documentation if the amount paid to the third party agent exceeds $2,500.00.  Supporting documentation must include a full explanation of the work performed, the applicable hourly rate and the hours spent on such work. CAFS will accept Excel, Word and PDF files.  Although submitting electronically, Lenders are still required to maintain the original Form 159 and supporting documentation in their loan file.  

The FTA version of Form 159 is now retired, and Lenders will no longer be able to access Form 159 in SBA One.  As of April 5, 2021 Lenders will be required to create and submit Form 159 exclusively through CAFS.  Questions about the new submission procedure and Form 159 in general can be emailed to form159@sba.gov.  

For assistance with SBA lending matters, please contact the attorneys at Starfield & Smith, PC at 215.542.7070 or visit us at www.starfieldsmith.com.