Small Business Administration (SBA) Loan Programs

SBA administers several loan programs. It sets the guidelines for the loans while SBA’s partners (namely lenders) make the loans to small businesses. SBA backs those loans with a guaranty that will eliminate some of the risk to the lending partners. The loan guaranty transfers the risk of borrower non-payment, up to the amount of the guaranty, from the lender to SBA. Therefore, when a business applies for an SBA Loan, they are actually applying for a commercial loan, structured according to SBA requirements, which receives an SBA guaranty. 

The SBA itself does not issue loans or offer grants.

7(A) Loan Program

7(A) Loans are available to for-profit businesses that qualify as small under SBA size standards and cannot borrow on reasonable terms from conventional lenders without government help. These loans can be used for fixed assets, working capital and/or to finance start-ups or the purchase of an existing business. The maximum percentage of SBA guaranty on this type of loan is 85% up to $150,000 and 75% over $150,000. The maximum loan amount is $5,000,000, and maturity is set at 5 to 7 years for working capital, up to 25 years for equipment and real estate and a maximum of 10 years for other purposes. 

The maximum interest rate is prime plus 2-1/4% for maturities under 7 years and prime plus 2-3/4% for maturities of 7 years or longer. There are fees involved in obtaining this type of loan.

SBA Express Loan Program

The eligibility requirements for applying for an Express Loan are similar to the 7(A) Loan requirements, and an Express Loan can also be used for the same purposes. However, the SBA only guarantees this type of loan up to 50%, and the maximum loan amount is $350,000. Express Loans must be paid within 7 years, and the interest rate is higher - the bank’s prime plus 6.5% for loans of $50,000 or less and the bank’s prime plus 4.5% for those exceeding $50,000. Loan fees are required but an SBA application is not. Loan credit authority is delegated to the bank.

Additional Information

For more information regarding SBA’s loan programs, view our Major U.S. Small Business Administration Loan Programs (PDF) or visit the Financing page.

Central Virginia Small Business Development Center

The Central Virginia Small Business Development Center is an intermediary organization and can help you prepare your loan package free of charge. For more information, visit the Central Virginia Small Business Development Center website or contact Betty Hoge at 434-295-8198.

Registering for Online Webinar

To register for a free SBA online webinar about the SBA’s loan programs, visit the Small Business Administration (SBA) website