What Is an SBA Loan?
A small business loan partially guaranteed by the U.S. Small Business Administration.
An SBA loan is a small business loan partially guaranteed by the U.S. Small Business Administration. The SBA itself doesn't lend money — banks and approved non-bank lenders make the loans, and the SBA guarantees a portion (typically 50% to 85%). That guarantee reduces lender risk, which means SBA borrowers get lower rates, longer repayment terms, and lower down payments than they could on a conventional loan with the same risk profile.
SBA loans are the right answer for most small business owners who can wait 30 to 90 days for closing. The trade-off is paperwork and timeline. The reward is the cheapest long-term capital available to a small business in America.
The Three Main SBA Programs
Different programs for different needs. We match you to the right one.
⭐ Most Popular
SBA 7(a)
Best for: working capital, acquisitions, refinancing
- Up to $5 million
- 10-year term (working capital), 25-year (real estate)
- Rates: Prime + 2.75% to + 4.75%
- Down payment: 10%–20% typical
- Use of funds: nearly any business purpose
- Closing: 30–90 days
🏢 Real Estate & Equipment
SBA 504
Best for: commercial real estate, major equipment
- No max project size (SBA portion up to $5M)
- 20- or 25-year fixed-rate terms
- Below-market fixed rates on the SBA portion
- Down payment: 10% typical
- Must be 51%+ owner-occupied if real estate
- Closing: 60–120 days
💼 Small Tickets
SBA Microloan
Best for: startups, smaller working capital needs
- Up to $50,000 (avg ~$13K)
- 6-year max term
- Rates 8%–13% typical
- Available to startups (under 2 years OK)
- Includes free technical assistance
- Closing: 30–60 days
How an SBA Loan Works
Three steps from pre-qualification to funded.
1
Pre-Qualify in 2 Minutes
Short form, soft credit pull, recent bank statements. We confirm SBA eligibility and identify the right program (7(a), 504, or Microloan) for your goal.
2
Matched to SBA-Preferred Lenders
We submit your file to SBA-preferred lender (PLP) partners — they have authority to approve and close SBA loans without sending each file to the SBA for review. That's how we cut weeks off the timeline.
3
Pick Your Offer & Close
You compare offers from competing SBA lenders, choose the best one, and complete the closing process. Funded amount wires to your business account at close.
SBA Loan Requirements
What you typically need to qualify.
Time in Business
2+ years (typical)
Annual Revenue
$120K+ typical
Personal Credit
FICO 680+ preferred
Pros & Cons of an SBA Loan
Is it the right product for your situation?
✓ Advantages
- Lowest rates in small business lending
- Longest terms (up to 25 years for real estate)
- Low down payment requirements
- No prepayment penalty after the early years on most products
- Can be used for nearly any business purpose
- Builds long-term banking relationships
⚠ Considerations
- 30–120 day closing timeline — slow vs. MCA or short-term loans
- Substantial paperwork (financials, tax returns, business plan)
- Personal guarantee required from all 20%+ owners
- Collateral may be required for larger loan amounts
- Higher minimum credit and revenue requirements
SBA Loan FAQs
Everything you need to know before you apply.
What is an SBA loan? ▲
An SBA loan is a small business loan partially guaranteed by the U.S. Small Business Administration. The SBA itself does not lend money — banks and approved lenders make the loans, and the SBA guarantees a portion (typically 50%–85%). That reduces lender risk, which allows lower rates, longer terms, and lower down payments than conventional loans.
How long does it take to get an SBA loan? ▼
SBA 7(a) loans typically close in 30 to 90 days. SBA Express loans can close faster (sometimes within 45 days). 504 loans (real estate or major equipment) often take 60 to 120 days due to the multi-party structure. The trade-off is the lowest rates and longest terms in small business lending.
What credit score do I need for an SBA loan? ▼
Most SBA-preferred lenders look for a FICO SBSS score of 155+ (which roughly correlates with personal FICO around 680+). Some specialty SBA lenders fund borrowers with lower scores, especially if cash flow and collateral are strong. The Broker Shop matches you to SBA lenders based on your full file, not just credit.
How much can I borrow with an SBA loan? ▼
SBA 7(a) loans go up to $5 million. SBA 504 loans (real estate and major equipment) can finance projects of any size, with the SBA portion typically up to $5 million. SBA Microloans go up to $50,000. The amount you qualify for depends on cash flow, debt service coverage, and collateral.
What are SBA loan rates in 2026? ▼
SBA 7(a) variable rates in 2026 typically range from Prime + 2.75% to Prime + 4.75%, depending on loan size and term. SBA 504 loans use a CDC-debenture pricing model with longer fixed rates that are typically below market. SBA Express tends to price 1%–2% higher than standard 7(a) due to faster underwriting.
Do I need collateral for an SBA loan? ▼
SBA lenders are required to follow standard collateral policies. For loans under $25,000, no collateral is required. For loans of $25K–$350K, lenders follow their internal policies. For loans over $350K, the SBA requires lenders to collateralize to the maximum extent possible. A personal guarantee is required from any owner of 20% or more of the business.
Explore Other Funding Options
Not the right fit? We offer every funding type.