Reference Guide to SBA Loan Programs

SBA.gov, updated March 2014.

The SBA Loan ProgramSBA 7(a)7 (a) Small Loan
SBA ExpressSBA Veterans Advantage CapLines
Community Advantage
DetailsAny 7(a) loan $350,000 and under, except the Community Advantage and Express loansThis program helps get small business loans into the hands of veterans. For loans up to $350,000 authorized under the SBA Express program, veterans will have no upfront fees. This program is due to expire 9/30/2016.1. Working Capital
2. Contract;
3. Seasonal; and
4. Builders
(Mission-focused lenders only. Expires 03/15/2017)
Maximum Loan Amount$5 Million$350,000$350,000$350,000$5 Million$250,000
Percent of Guaranty85% guaranty for loans of $150,000 or less; 75% guaranty for loans greater than $150,000 (up to $3.75 million maximum guaranty)If the lona amount is less than $350,000, its requirements will conform to the SBAExpress program. Loans above this amount will follow the 7(a) guidelines.50%
Same as SBA ExpressSame as 7(a)Same as 7(a)
Use of ProceedsTerm Loan. Expansion/renovation; new construction, purchase land or buildings; purchase equipment, fixtures, lease-hold improvements; working capital; refinance debt for compelling reasons; seasonal line of credit, inventory or starting a businessSame as 7(a)May be used for revolving lines of credit (up to 7 year maturity) or for a term loan same as 7(a).Same as SBA ExpressFinance seasonal and/or short-term working capital needs; cost to perform; construction costs;
advances against existing inventory and receiva-bles; consolidation of short-term debts. May be revolving.
Same as 7(a)
MaturityDepends on ability to repay. Generally, working capital & machinery & equipment (not to exceed life of equipment) is 5-10 years; real estate is 25 years.Same as 7(a)Up to 7 years for Revolving Lines of Credit, including term out period. Otherwise, same as 7(a).Same as SBA ExpressUp to 10 years, except Builder’s CAPLine, which is 5 yearsSame as 7(a)
Guaranty Fees(No SBA fees on loans of $150,000 or less approved in FY 2014.) Fee charged on guarantied portion of loan only. $150,001 – $700,000 = 3.0%; $700,000 – $1,000,000 = 3.5%; plus 3.75% on guaranty portion over $1 million. Ongoing fee of 0.52% on loans over $150,000.

Same as 7(a)Same as 7(a)No guaranty fee. Ongoing fee of 0.52% on loans above $150,000.Same as 7(a)Same as 7(a)
Who QualifiesMust be a for-profit business & meet SBA size standards; show good character, credit, management, and ability to repay. Must be an eligible type of business. Prepayment penalty for loans with maturities of 15 years or more if prepaid during first 3 years. (5% year 1, 3% year 2 and 1% year 3)Same as 7(a). Plus,all loan applications will be credit scored by SBA. If not an acceptable score, the loan can be submitted via full standard 7(a) or Express.Same as 7(a)Same as 7(a) Plus, small business must be owned and controlled (51%+) by one or more of the following groups: veteran, active-duty military in TAP, reservist or National Guard member or a spouse of any of these groups, or a widowed spouse of a service member or veteran who died during service, or a service-connected disability.Same as 7(a) Plus, all lenders must execute Form 750 & 750B (short-term loans)Same as 7(a)
Benefits to BorrowerLong-term financing;
Improved cash flow;
Fixed maturity; No balloons;
No prepayment penalty (under 15 years)
Same as 7(a)Fast turnaround;
Streamlined process;
Easy-to-use line of credit
Same as SBAExpress
No guaranty fee
1. Working Capital – (LOC)
Revolving Line of Credit
2. Contract – can finance all costs (excluding profit).
3. Seasonal – Seasonal working capital needs.
4. Builder – Finances direct costs when building a commercial or residential
structure
Same as 7(a) Plus
lenders must be CDFIs, CDCs or micro-lender target-ing underserved market