Types of SBA loans
There are four main types of SBA loans: the 7(a) loan, the SBA’s general-purpose program of up to $5 million; SBA Express, a faster 7(a) option of up to $500,000; the 504 loan, which finances buildings and major equipment up to $5.5 million; and the Microloan, which lends up to $50,000 through nonprofit intermediaries.
All four are made by lenders, not by the SBA itself — the agency guarantees part of the loan, which is what lets lenders offer longer terms than a conventional business loan. The program limits below come from the SBA’s own program comparison.
| Program | Best for | Maximum | Term |
|---|---|---|---|
| SBA 7(a) | Working capital, equipment, real estate, buying a business, refinancing | $5 million | Up to 10 years; up to 25 years for real estate |
| SBA Express | Working capital and revolving lines of credit | $500,000 | Same maturity rules as 7(a) |
| SBA 504 | Buildings, land and long-life equipment | $5.5 million (from $25,000) | 10 or 25 years, fixed rate |
| SBA Microloan | Working capital, inventory, supplies, small equipment | $50,000 | Up to 7 years |
SBA 7(a) loans are the default choice when you need flexible money: working capital, equipment, a business purchase or refinancing existing debt. Loans of $350,000 or less are processed as 7(a) Small loans, and larger ones as standard 7(a). Maturity is generally 10 years or less, extending to 25 years when the loan finances real estate. Our SBA loans explainer covers who qualifies and why approval takes longer than other products.
SBA Express loans trade a smaller maximum for speed: lenders with Express authority can approve and close without waiting on SBA review, and Express is one of the few SBA products that allows a revolving line of credit. The SBA guarantee is 50%, lower than standard 7(a), so lenders are choosier. See the SBA Express loan explained for where it fits.
SBA 504 loans are for fixed assets — buying or renovating a building, buying land, or equipment with a useful life of at least 10 years. They are delivered through Certified Development Companies alongside a conventional lender, and carry long fixed-rate terms of 10 or 25 years. They cannot be used for working capital or inventory. Our guide to the SBA 504 loan walks through the three-part structure.
SBA Microloans are the smallest program. The SBA funds nonprofit intermediary lenders, which then lend up to $50,000 — the average microloan is about $13,000 — with a maximum repayment term of seven years. Microloans can pay for working capital, inventory, supplies, furniture and equipment, but not real estate or existing debt, and each intermediary sets its own requirements. More in the SBA microloan explained.
Not sure which program fits? The Broker Shop is a funding broker, not a lender: one application is matched to the lenders whose guidelines you meet, including SBA lenders, so you can compare an SBA loan side by side with faster options. It is free to apply, and checking your options won’t affect your credit score. Our SBA loan calculator estimates payments before you apply.
Sources: U.S. Small Business Administration — Types of 7(a) loans and SBA loan program comparison; SBA — 504 loans; SBA — Microloans.
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