Estimate monthly payments, total interest, and down payment for SBA 7(a) and 504 loans. Results are instant — no email required to see them.
Enter your deal parameters below. Use the 7(a) program for business acquisitions and working capital; the 504 program for real estate and equipment.
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SBA loans are one of the most powerful financing tools available to small business owners — offering lower down payments, longer terms, and better rates than most conventional alternatives. Here's what every borrower should know.
SBA 7(a) rates are variable and reset with the Prime Rate. These ranges reflect current market conditions as of early 2026. Actual rates depend on loan size, term, lender, and borrower profile.
| Loan Type | Loan Amount | Max Term | Rate Range (2026) | Down Payment |
|---|---|---|---|---|
| SBA 7(a) | Up to $5M | 10 yrs / 25 RE | 10.0% – 12.5% | 10% min |
| SBA 504 (CDC portion) | Up to $5.5M | 10, 20, or 25 yrs | Fixed ~6.0% – 7.5% | 10% – 15% |
| SBA Express | Up to $500K | 7 yrs | 11.5% – 14.5% | 10% – 20% |
| SBA Microloans | Up to $50K | 6 yrs | 8.0% – 13.0% | Varies |
Rate ranges are estimates based on Prime Rate + lender spreads as of Q1 2026. Rates change with Prime Rate movements. Consult an SBA lender for a current quote specific to your deal.
An SBA loan is a conventional bank loan where the U.S. Small Business Administration guarantees a portion of the loan (up to 85% for smaller loans, 75% for larger ones). This guarantee reduces the lender's risk, which is why SBA borrowers can access lower down payments, longer repayment terms, and more favorable rates than most conventional small business loans. The SBA doesn't lend money directly — it backs the loan made by an approved lender.
SBA 7(a) loans for business acquisitions typically require a minimum 10% equity injection from the borrower. The SBA does not set a universal minimum, but most lenders require at least 10% and sometimes 15–20% depending on the deal risk profile. For SBA 504 loans on commercial real estate, the borrower contribution is typically 10–15%. Special-use properties (restaurants, hotels, gas stations) often require 15–20% down due to higher risk.
Most SBA lenders require a personal credit score of at least 680. Some lenders will consider scores as low as 650, but expect higher rates and more stringent underwriting. Scores above 700 will qualify you for the best rates and terms. Beyond the credit score, lenders assess your full credit profile — payment history, existing debt load, and any prior bankruptcies or defaults (which can disqualify you entirely for SBA financing).
DSCR (Debt Service Coverage Ratio) measures your business's ability to cover its debt payments from operating income. The formula is: Net Operating Income ÷ Total Annual Debt Service. SBA lenders require a minimum DSCR of 1.25x, meaning the business generates $1.25 in income for every $1.00 in debt payments. A DSCR below 1.0x means the business can't cover its own debt — which will result in a denial. Use our free DSCR Calculator to check your ratio before applying.
Standard SBA 7(a) loans typically take 30–90 days from application to funding. Preferred Lender Program (PLP) banks have delegated authority to approve loans faster — often 2–3 weeks. SBA Express loans can get SBA approval within 36 hours, though the full funding process still takes longer. Timeline depends heavily on how quickly you can provide complete documentation and how complex the transaction is. Business acquisitions typically take longer than working capital loans due to additional diligence requirements.
Yes — SBA 7(a) loans are commonly used for business acquisitions. The business being purchased must be a for-profit U.S. business, and the acquisition must make financial sense (the cash flow of the acquired business must support the loan payments). Lenders will want to see 2–3 years of the target business's financial statements, tax returns, and a clear valuation. Seller financing (seller carrying a portion of the purchase price on standby) can sometimes be structured to help buyers meet the equity injection requirement.