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SBA Loan Options
Quick Reference to SBA Loan Programs
| Program | Maximum Amount Guaranteed | Percent of Guarantee (Maximum) | Use of Proceeds | Maturity | Maximum Interest Rates | Guaranty Fees | Who Qualifies |
|---|---|---|---|---|---|---|---|
| 7(a) Loan Guaranty | $750,000 in most cases | 75% (80% if total loan is $100,000 or less) | Expansion or renovation: construction of new facility; purchase land or buildings; purchase equipment, fixtures, leasehold improvements; working capital; refinance debt for compelling reasons; seasonal line of credit; inventory | Depends on ability to repay; generally working capital is 5-10 years; machinery / equipment, real estate, construction, up to 25 years (not to exceed life of equipment) | Negotiable with lender; loans under 7 years, maximum = prime + 2.25%; 7 years or more, maximum = 2.75% over prime; under $50,000 may be slightly higher | Paid by lender (may be passed on). Based on maturity amount of SBA exposure; 1 year or less, 0.25%; over 1 year, SBA share $80,000 or less, 2%; over 1 year, SBA share more than $80,000 figured on incremental scale | Must be operated for profit and meet SBA size standards; show good character, management expertise and commitment, and ability to repay; may not be involved in speculation or investment rental real estate. |
| Specialized 7(a) SBA Low Doc | $150,000 | 75% (80% if total loan is $100,000 or less) | Designed to increase the availability of funds under $150,000 and streamline / expedite the loan review process. | See 7(a) | See 7(a) | See 7(a) | See 7(a) |
| LowDoc One page SBA loan application, quick-turn around after applicant meets lender requirements | $150,000 | 80% | Same as 7(a) except may not be used to repay existing debt | Depends on ability to repay and use of proceeds, but not to exceed 25 years for fixed assets; 10 years in all other uses | See 7(a) | See 7(a) | Start-ups, businesses with $5 million or less annual sales for past 3 years; employ 100 or fewer; program relies on applicant's character and credit history. |
| SBA Express Lender approves loan, no additional paperwork for SBA | $150,000 (total loan amount) | See 7(a) | Same as 7(a); limitations on real estate and construction; may be used for term loans or revolving credits of not more than 5 years | See 7(a) | See 7(a) | See 7(a) | See 7(a) (Pilot program available through 18 lenders) |
| Minority Prequalification Loan Program and Women's Prequalification Loan Program Intermediaries help prepare application | $250,000 generally (total loan amount) | 75%, see 7(a) | See 7(a) | See 7(a) | See 7(a) | See 7(a); plus minority program may use for-profit intermediaries, fees will vary, women's program uses non profits only; both may charge fees | Must be at least 51% owned and operated by racial/ethnic minority or women: $5 million or less annual sales for past 3 years; employ 100 or fewer, focus on credit history, ability to repay, probability of success |
| CAP Lines Short-term & RLCs Seasonal Contract Builders Standard Asset Based Small Asset Based | $750,000 (total loan amount except small asset based) $200,000 | 75%, see 7(a) | Finance seasonal working capital needs; costs to perform; construction costs; advances against existing inventory and receivables; consolidation of short-term debts | Up to 5 years | Same as 7(a) except the Standard Asset Based; no fee restriction but fee disclosure to SBA required | See 7(a) | Existing businesses. See 7(a) |
| International Trade Loan Program | $1.25 million | Depends on whether done under 7(a) or 504; see both | Combination of working and fixed-asset financing; improvement in U.S. for producing goods or services may not be used to pay existing debt | Up to 25 years | See 7(a) | See 7(a) | Small businesses [See 7(a) for qualifications] engaged or preparing to engage in international trade or adversely affected by competition from imports |
| Export Working Capital Program Combined effort of SBA and Ex-Im Bank; 1-page application, fast turnaround, may apply for prequalification letter | $750,000 (may be combined with International Trade Loan) | SBA: $750,000 ($1 million in some cases); private lender unlimited | Short-term working capital lans for exporters | Matches single transaction cycle or generally 1 year for line of credit | No cap | See 7(a) | Small businesses exporters [see 7(a) for other qualifications] who need short-term working capital |
| DELTA Defense Loan and Technical Assistance Program; joint effort of SBA (including SCORE, SBDCs and DoD) | $1.25 million (total loan amount) | See 7(a), 504 | Financial and technical assistance to help defense-dependent firms diversify into commercial market | See 7(a), 504 | See 7(a), 504 | See 7(a), 504 | Defense-dependent small firms [see 7(a), 504 for qualifications] adversely affected by defense cuts. |
| 7(m) MicroLoan Program Through non-profit lending organizations; technical assistance also provided | $25,000 (total loan amount to small business borrower) | Not applicable | Purchase equipment, machinery, fixtures, leasehold improvements; finance increased working capital; may not be used to repay existing debt | Shortest term possible, not to exceed 6 years | Negotiable with intermediary | No guaranty fee | Same as 7(a) |
| 504 Certified Development Company Program | Limit on SBA portion of project is $750,000 to $1 million | 40% of project (100% SBA-backed debenture) | Long-term, fixed asset loans through nonprofit development companies licensed by SBA; must create or retain 1 job per $35,000 debenture proceeds | Up to 20 years | Based on current market rate for 5- and 10-year Treasury issues, plus an increment above Treasury rate | Fees related to debenture, approx. 3% | For-profit businesses that do not exceed $6 million in tangible net worth and do not have average net income over $2 million for past 2 years. |
BizPlanBuilder has been used many times to get financing through an SBA loan.
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