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Small Business and SBA Lending Blog
Last updated on Feb 19, 2023
2 min read

What Is the SBA 7(a) Loan Interest Rate? (Updated Daily)

Interest rates for the SBA 7(a) loan depend on the amount of the loan. From there, they’re divided into two groups: those with a maturity of less than seven years, and those with a maturity of more than seven years.

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In this article:
  1. Current SBA 7(a) Loan Rates
  2. Small Business Loan Rates: Comparison
  3. SBA 7(a) Loan Interest Rates by Loan Amount
  4. Base Rates
  5. Uses for Different Small Business Loans: Comparison
  6. Related Questions
  7. Get Financing

The interest rate you receive on an SBA 7(a) loan depends on the amount of the loan and potential other factors. Loans with maturities of less than seven years carry higher rates than longer-term SBA 7(a) loans.

Current SBA 7(a) Loan Rates

Small Business Loan Rates: Comparison

SBA 7(a) Loan Interest Rates by Loan Amount

Interest rates for the SBA 7(a) loan depend on the amount of the loan. They’re divided into three groups:

Loan Amount

Maturity of less than 7 years

Maturity of more than 7 years

$25,000 or less

Prime rate + 4.25%

Prime rate + 4.75%

$25,001 to $50,000

Prime rate + 3.25%

Prime rate + 3.75%

$50,001 and up

Prime rate + 2.25%

Prime rate + 2.75%

*Current prime rate is 7.5% as of January 2023.

Base Rates

Uses for Different Small Business Loans: Comparison

Loan Name

Valid Uses

Invalid Uses

SBA 7(a) Standard Loan

  • Expansion
  • Renovation
  • Vacant land
  • Building purchases
  • Startup costs
  • Equipment and fixtures
  • Working capitalInventory
  • Seasonal line of credit
  • Refinancing debt
  • Paying off inadequately secured creditors
  • Expenses for nonprofits or any business in the following industries: speculation, lending, investment, rental real estate, gambling

SBA 7(a) Small Loan

All from 7(a) Standard list

All from 7(a) Standard list

SBA 7(a) Express Loan

  • All from 7(a) Standard List
  • Revolving line of credit

All from 7(a) Standard list

SBA 7(a) CAPLines Loan

  • Short-term, cyclical, revolving and non-revolving working capital
  • Consolidation of short-term debts
  • All from 7(a) Standard list
  • Long-term expenses

SBA 7(a) Export Working Capital Program Loan

Short-term, cyclical, revolving and non-revolving working capital for export transactions

  • All from 7(a) Standard list
  • Expenses for non-export businesses

SBA 7(a) Export Express Loan

Export business expenses

  • All from 7(a) Standard list
  • Expenses for non-export businesses

SBA 7(a) Veterans Advantage Loan

All from 7(a) Standard list

All from 7(a) Standard list

SBA 504 Loan

  • Building purchases
  • Land
  • Renovation
  • Furniture and equipment
  • All from 7(a) Standard list
  • Costs not directly attributable to, or necessary for, the project

Related Questions

What is the current SBA 7(a) loan interest rate?

The current SBA 7(a) loan interest rate is WSJ Prime + 2.75% for loans of $50,001 and up, WSJ Prime + 3.75% for loans of $25,001 to $50,000, and WSJ Prime + 4.75% for loans of $25,000 or less. The current prime rate is 7.75% as of February 2023.

Source: SBA 7(a) Loan Interest Rates by Loan Amount and SBA Express Loan Interest Rates

What are the eligibility requirements for an SBA 7(a) loan?

The eligibility requirements for an SBA 7(a) loan include:

  • The business must meet the SBA's size standards for its particular industry.
  • The business must have fewer than 500 employees and less than $7.5 million in revenue each year for the previous three years.
  • The business must physically be based in the U.S. and operate within the U.S. and its territories.
  • The business must operate for profit.
  • Business owners must first have used other sources of financing, including personal funds, in order to qualify.
  • Businesses must not be involved in lending, real estate, or speculation.
  • Your business must operate for profit. Nonprofits and not-for-profit businesses are not eligible.
  • You must also have some equity in the business — this could mean you already have a profitable business, or you could use your own personal equity as collateral.
  • If you have any alternative financial resources, you must have used them first. For example, if you have a personal savings account or are able to get a personal loan, then you must first pursue those options before applying for an SBA 7(a) loan.
  • The business owner cannot be on parole.
  • You must be doing business in the U.S. or its territories.

What are the advantages of an SBA 7(a) loan?

The advantages of an SBA 7(a) loan include:

  • Highly competitive, low interest rates
  • Long loan terms, up to 25 years
  • Fixed and variable-rate options are available
  • A variety of businesses are eligible
  • Low down payments, typically around 10-20%
  • Variety of loan options, including SBA 7(a) express loans, SBA 7(a) CAPLines
  • Most SBA loans, including 7(a) loans are fully amortizing, meaning borrowers don’t have to worry about balloon payments

What are the disadvantages of an SBA 7(a) loan?

SBA 7(a) loan disadvantages include:

  • Lengthy approval times (for standard SBA 7(a) loans)
  • Lots of documentation
  • Collateral is often required
  • Certain businesses, including real estate investing, lending, gambling, and speculation are prohibited
  • High credit scores are typically required (typically 680+)
  • May be restrictions on supplemental/additional financing

Source: www.sba7a.loans/sba-7a-loans-small-business-blog/pros-and-cons

Source: www.commercialrealestate.loans/blog/difference-between-sba-7a-and-sba-504-in-cre

How long does it take to get approved for an SBA 7(a) loan?

The length of time it takes to get approved for an SBA 7(a) loan depends on the type of loan processing used. Standard 7(a) loan processing takes between 7-10 business days, while Certified Lenders Program (CLP) processing takes only 3 business days.

For more information, please see the following sources:

  • How Long Does it Take to Approve an SBA 7(a) Loan?
  • How to Fill Out Paperwork for the SBA 7(a) Loan
In this article:
  1. Current SBA 7(a) Loan Rates
  2. Small Business Loan Rates: Comparison
  3. SBA 7(a) Loan Interest Rates by Loan Amount
  4. Base Rates
  5. Uses for Different Small Business Loans: Comparison
  6. Related questions
  7. Get Financing

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