Program Preference [Business Credit and Assistance] Law and Legal Definition

According to 13 CFR 120.1700 [Title 13 -- Business Credit and Assistance; Chapter I -- Small Business Administration; Part 120 -- Business Loans; Subpart J--Establishment of SBA Secondary Market Guarantee Program for First Lien Position 504 Loan Pools], Program Preference means “any arrangement giving the Seller, Pool Originator, or a Program Associate or Affiliate of Seller or Pool Originator, a preference or benefit of proportion greater than its Loan Interest as compared to Pool Originator, Pool Investor, or SBA relating to the making, servicing, or liquidation of the Loan with respect to such things as repayment, collateral, guarantees, control, maintenance of a compensating balance, purchase of a certificate of deposit or acceptance of a separate or companion loan, without SBA's consent. Seller's agreement to grant a Pool Loan's Obligor a deferment in return for receiving more collateral on a different loan owned by Seller is an example of a preference.”