Rules eliminate discretion, but discretion can embed information. I study this tradeoff using the 2014 SBA reform that replaced lender-discretionary collateral appraisals with standardized haircuts. Exploiting cross-state variation in homestead exemptions, I find that loan spreads fall more where business assets are the lender's primary recovery source: spreads fall 12.8 basis points in unlimited-exemption states, where lenders face higher frictions accessing the borrower's home equity, relative to zero-exemption states, and the effect increases monotonically with the exemption level across all states. Credit growth declines for experienced repeat borrowers but not for first-time borrowers, consistent with the loss of relationship-specific information embedded in discretionary valuations. UCC filing data from three states show that lenders relying mainly on business collateral draft broader and more detailed liens post-reform, adding clauses covering future acquisitions and listing more identifiable assets (serial numbers, account numbers), while lenders with home equity recourse shift five times faster toward generic blanket claims. The results reveal a fundamental tradeoff: standardization corrects the conservative bias in collateral valuations, lowering average pricing, but displaces the private information through which relationship lenders supported known borrowers.