Small Business Administration (SBA) loans are widely considered the gold standard of small business financing in the US. By guaranteeing up to 85% of commercial loans issued by partner banks, the SBA enables entrepreneurs to access lower interest rates and longer repayment tenures.
Primary SBA Loan Programs
Before pursuing government-guaranteed financing, review our foundational overview on commercial and personal borrowing.
- SBA 7(a) Loan Program: The flagship program offering up to $5,000,000 for working capital, equipment, inventory, and business acquisitions. Repayment terms span up to 10 years for working capital and 25 years for commercial real estate.
- SBA 504 Loan Program: Fixed-rate long-term financing for major fixed assets such as purchasing owner-occupied buildings or heavy machinery.
- SBA Microloans: Loans up to $50,000 distributed through non-profit community lenders, tailored for startups and underserved founders.
SBA 7(a) Loan Terms Breakdown
| Loan Size | Max Allowable Interest Rate | SBA Guaranty |
|---|---|---|
| Under $50,000 | Base Rate + up to 6.5% | 85% |
| $50,001 to $250,000 | Base Rate + up to 6.0% | 75% |
| $250,001 to $5,000,000 | Base Rate + up to 4.5% | 75% |
Protecting and Operating Your Enterprise
Lenders routinely require evidence of commercial general liability insurance and key-person life insurance before approving SBA disbursements. Manage day-to-day corporate spending with top-tier business rewards credit cards.