SBA 7(a) Loan Frequently Asked Questions

What is an SBA 7(a) loan?

An SBA 7(a) loan is the SBA's primary program for providing financial assistance to small businesses. These loans can be used for most business purposes, including working capital, equipment, real estate, and business acquisition.

How much can I borrow with an SBA 7(a) loan?

SBA 7(a) loans can go up to $5 million. The actual amount you can borrow depends on:

• Business needs
• Ability to repay
• Business type
• Available collateral

Who qualifies for an SBA 7(a) loan?

Basic eligibility requirements include:

• Operating for-profit business
• Located in the United States
• Owner invested equity
• Used alternative financial resources first
• Demonstrated ability to repay

What credit score is needed?

While the SBA doesn't set a minimum credit score, most lenders prefer:

• Personal credit score of 680+
• Clean credit history
• No recent bankruptcies
• No defaults on government loans

What are typical SBA 7(a) loan terms?

Loan terms vary by use:

• Working capital: Up to 10 years
• Equipment: Up to 10 years
• Real estate: Up to 25 years
• Business acquisition: Up to 10 years

What are current interest rates?

SBA 7(a) loan rates are based on:

• Base rate (Prime, LIBOR, or SBA peg rate)
• Loan amount
• Loan term
• Maximum spread set by SBA