The SBA 7(a) loan program is the U.S. Small Business Administration’s primary loan program. It doesn’t usually lend money directly—instead, the SBA guarantees a portion of a loan made by an approved lender, which can make it easier for small businesses to qualify for financing on reasonable terms.
Below is a clear, practical guide to what 7(a) loans are, what you can use them for, and how to apply.
What you can use a 7(a) loan for
7(a) loans are known for flexibility. Common eligible uses include:
- Buying, refinancing, or improving real estate and buildings
- Short- and long-term working capital
- Refinancing existing business debt
- Buying and installing machinery and equipment (the SBA page also notes AI-related expenses)
- Purchasing furniture, fixtures, and supplies
- Change of ownership (full or partial business acquisition)
- “Multiple purpose” financing that combines the above
Maximum loan amount: up to $5 million.
Basic eligibility requirements
To be eligible for SBA 7(a) loan assistance, a business generally must:
- Be an operating business
- Operate for profit
- Be located in the U.S.
- Meet SBA size standards (i.e., be considered “small” under SBA rules)
- Not fall into an SBA ineligible business category
- Be unable to obtain the desired credit on reasonable terms from non-government sources
- Be creditworthy and show a reasonable ability to repay
Your lender helps determine the best 7(a) structure for your situation.
How SBA guarantees work (and why they matter)
The SBA guarantee reduces lender risk—but it’s not “free money,” and you’re still responsible for repayment.
Typical guarantee levels for most 7(a) loans include:
- Up to 85% for loans $150,000 or less
- Up to 75% for loans over $150,000
- Some programs differ (for example, SBA Express uses a lower guarantee percentage).
Terms and interest rate rules (the stuff that affects your payment)
Repayment terms
7(a) maturity is designed to be the “shortest appropriate term” based on repayment ability, with common caps including:
- Up to 10 years for many uses
- Up to 25 years when financing or refinancing real estate (and some longer-life equipment scenarios)
Interest rates
Rates are negotiated between you and the lender, but subject to SBA maximums. For variable-rate 7(a) loans, the SBA caps are tied to a base rate (often prime) plus a spread, such as:
- $50,000 or less: base + 6.5%
- $50,001–$250,000: base + 6.0%
- $250,001–$350,000: base + 4.5%
- Over $350,000: base + 3.0%
Fees to be aware of (and where to check current numbers)
7(a) loans can include SBA-related fees. The SBA notes that lenders pay an Upfront Fee (SBA guaranty fee) and are generally allowed to pass it on to the borrower.
Because fee schedules can change by fiscal year and program type, the SBA also publishes tools and notices—like its FY 2026 guaranty fee calculator—to estimate borrower fees based on the loan type and timing.
Types of 7(a) loans (why the “type” matters)
7(a) isn’t just one product. The SBA has multiple 7(a) variants with different limits, turnaround times, and features. Examples include:
- Standard 7(a): generally $350,001 to $5 million, commonly up to 75% SBA guarantee
- 7(a) Small: up to $350,000 (with guarantee levels depending on size)
- SBA Express / Export Express: typically capped at $500,000
- Working-capital and export-focused options: including programs designed for lines of credit and international trade needs
The SBA also notes a newer 7(a) Working Capital Pilot (WCP) that offers monitored lines of credit within the 7(a) program.
How to apply for an SBA 7(a) loan
You apply through a lender, not directly through the SBA. The SBA recommends using Lender Match to connect with participating SBA lenders, then completing the application with that lender.
The required documents vary by loan size and lender process, but the lender will guide you based on your circumstances.
Repayment and managing your loan
Repayment terms vary, but many 7(a) term loans are repaid with monthly principal-and-interest payments from business cash flow.
For certain borrowers, the SBA also notes the MySBA Loan Portal can be used to monitor loan status and view statements (especially relevant for SBA-purchased 7(a) loans).
A timely note for manufacturers (current through FY 2026)
The SBA announced that for FY 2026, small manufacturers may qualify for 0% upfront fee on certain 7(a) manufacturing loans up to $950,000, effective October 1, 2025 through September 30, 2026.