SBA 7(a) Loan Calculator

Ask what the SBA guaranty fee is on a $2,000,000 loan and the common answer is "3.5%, so $70,000". It is wrong twice. The tier is selected by the gross loan amount, but the fee is charged on the guaranteed portion — 75% here, or $1,500,000. And the top tier splits: 3.5% applies only to the first $1,000,000 of guaranteed amount, with 3.75% on the rest. The real fee is $35,000 plus $18,750 — $53,750, a quarter less than the folk answer.

The same confusion runs the other way at the bottom of the schedule. A $150,000 loan is guaranteed at 85% and pays 2% of $127,500 — $2,550. One dollar more and the loan drops to a 75% guarantee and a 3% tier: $3,375 on $112,500. The borrower of $150,001 pays more fee for less guarantee, which is the kind of boundary worth knowing about before setting the ask.

FY2026 adds a waiver with a similar edge: manufacturers in NAICS sectors 31–33 pay no upfront fee at all on loans up to $950,000, and the full fee above it. For a manufacturer with any flexibility in project size, the difference between borrowing $950,000 and $960,000 is the entire fee.

Almost every 7(a) borrower finances the guaranty fee into the loan. It feels free — no cash at closing — but it means borrowing more than you receive and paying the note rate on the difference for the full term.

The honest way to price that is the same way a bond desk would: find the single rate that equates the cash you actually received with the payments you actually make. On a typical mid-sized loan the financed fee adds roughly a quarter to half a percentage point to the annualised cost of the money. That number, not the note rate, is what belongs in a comparison against a conventional loan with different fees.

Two other pricing facts are easy to miss. Most 7(a) loans float — the quote is Prime plus a spread, and the payment resets when Prime moves, so the figures here are today's snapshot rather than a promise. And the SBA's 0.55% annual service fee is charged to the lender on the guaranteed balance with an explicit ban on passing it through, which in practice means it is baked into the spread. It is one reason quoted spreads cluster near the caps.

The SBA publishes hard caps on what a lender may charge over the base rate: 6.5% on loans to $50,000, 6% to $250,000, 4.5% to $350,000, and 3% above that. A quote outside those bounds is not a compliant 7(a) loan, whatever it is being called, and the caps give a borrower more negotiating information than most realise — a $400,000 quote at Prime plus 5 is not a hard bargain, it is impermissible.

Terms are capped too: ten years for working capital and equipment, twenty-five for real estate. The long amortisations are much of the product's appeal — a ten-year working capital loan halves the payment of the five-year conventional equivalent — and there is no prepayment penalty at all on maturities under fifteen years.

Finally, the fee schedule is a fiscal-year animal. The SBA reprices every August in an Information Notice, effective 1 October; fees have swung from full waivers on small loans to the current schedule within a few years. A loan that closes either side of 30 September can carry a different fee, which occasionally makes the approval date itself worth managing.