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SBA Loan Options, More Flexibility
Through approved lenders and partial SBA guarantees, SBA loans are structured to make capital more accessible and affordable. The 7(a) program is the most flexible, supporting everything from working capital to acquisitions and refinancing, whereas the 504 program is tailored to long-term fixed-asset investments, including commercial real estate and heavy equipment.
SBA 7(a) Loans
The SBA 7(a) loan is the most versatile SBA financing program, supporting a broad range of business needs including working capital, business acquisitions, equipment purchases, commercial real estate, and eligible debt refinancing.
SBA 504 Loans
For large, fixed-asset projects—such as owner-occupied commercial real estate or major equipment—SBA 504 loans offer long-term, typically lower-rate financing (up to approximately $5.5 million) through a structured partnership with Certified Development Companies (CDCs)
SBA 7(a) Loans
- Loan amount: $50,000 – $5,000,000
- Terms: up to 10,25 years (depending on use of funds)
- Fixed interest rates (risk-based)
- Monthly payments
- Global DSCR typically 1.15x or higher
- No prepayment penalty on terms under 15 years
Underwriting Requirements
- Time in Business: 2-3+ years in business
- Credit Profile: 680+ FICO for primary owners
- Cash Flow: Demonstrated ability to service debt (DSCR > 1.15x)
- Tax History: No unresolved federal tax liens
- Credit Events: No recent bankruptcies or foreclosures within the last three years
- Loan Sizing: Loan amount must be reasonable relative to historical revenue and cash flow
- Personal Guarantees: Required for owners with 20% or more ownership
- Collateral: Required when available (SBA requires lenders to collateralize when possible)
Documentation Requirements
- Business tax returns (typically last 2-3 years)
- Personal tax returns (typically last 2-3 years)
- Interim Profit & Loss statement and Balance Sheet
- Debt schedule
- Business bank statements (last 6-12 months)
- Personal financial statement(s) for guarantors
- Proof of insurance (General Liability and Workers’ Compensation)
SBA 504 Loans
- Loan amount: up to $5,500,000
- Terms: up to 10,20, 25 years (depending on asset type)
- Fixed interest rates (risk-based)
- Monthly payments
- 50% bank financing | 40% SBA/CDC | 10% borrower
- Prepayment penalty may apply
Underwriting Requirements
- Time in Business: 2+ years in business
- Credit Profile: 680+ FICO for primary owners
- Cash Flow: Demonstrated ability to service debt (DSCR > 1.15x)
- Tax History: No unresolved federal tax liens
- Occupancy: Property must be majority owner-occupied (generally 51%+ for existing buildings, 60% for new construction)
- Personal Guarantees: Required for owners with 20% or more ownership
- Collateral: Financed assets serve as primary collateral
Documentation Requirements
- Proof of insurance (General Liability and Workers’ Compensation)
- Business tax returns (typically last 2-3 years)
- Personal tax returns (typically last 2-3 years)
- Interim Profit & Loss statement and Balance Sheet
- Debt schedule
- Business bank statements (last 6-12 months)
- Personal financial statement(s) for guarantors
SBA / USDA Loan Calculator
Estimates monthly payments on an amortizing loan. For planning only. Not an approval or offer.
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Note: SBA/USDA loans may include guarantee fees, CDC fees (504), closing costs, and reserves not reflected here.