SBA 7(a) is the flagship small business loan program from the U.S. Small Business Administration. Loans up to $5M for working capital, equipment, real estate, and acquisitions. The SBA guarantees 75-90% of the loan, which lets banks offer better terms than they would otherwise.
The 2026 terms. - Loan amount: up to $5M (up to $5.5M with combined 7(a) + 504). - Interest rate: variable rate, prime + 2.75% to 4.75% based on loan size and term. With 2026 prime ~7.5%, APR ranges 10.25-12.25%. - Term: 10 years for working capital, 10 years for equipment, 25 years for commercial real estate. - SBA guarantee fee: 0.25-3.75% based on loan size and term (rolled into loan). - Down payment: 10% typical (varies by use of proceeds).
Qualification requirements. - 24+ months operating history. - 680+ personal credit (some lenders flexibly down to 650). - Strong DSCR (1.15+). - US-based business, owner-occupied if CRE. - Owners with 20%+ stake must personally guarantee. - Use of proceeds must match SBA-approved categories.
The 30-90 day timeline (and why). - Days 1-10: pre-qualification + document gathering (3 years business + personal tax returns, financial projections, P&L, balance sheet). - Days 10-30: lender underwriting + SBA submission. - Days 30-60: SBA approval (or kickback for additional docs). - Days 60-90: closing + funding.
Top SBA 7(a) lenders (2026). - Live Oak Bank — #1 SBA lender by dollar volume for 7+ years. Industry-specialty teams. - JPMorgan Chase — top-5 SBA originator. - Wells Fargo — top-3 historically. - Newtek Small Business Finance — top-3 non-bank SBA lender. - SmartBiz Loans — fintech UX layered on SBA partner banks.
SBA 7(a) vs MCA — the cost comparison. - $500K capital need. - SBA 7(a) at 10% APR over 10 years: monthly payment ~$6,600. Total interest paid: $292K. - Same $500K via MCA at factor 1.30 over 12 months: monthly payment ~$54K. Total cost: $150K. - MCA looks cheaper short-term but: SBA spreads cost over 10 years (manageable) while MCA crushes cash flow over 12 months. - For genuine 10-year capital needs, SBA is always cheaper.
The strategic insight. SBA 7(a) is the cheapest non-personal-credit financing available to small businesses. The 30-90 day wait is the price you pay. If you qualify, almost always worth it vs MCA for capital needs longer than 18 months.
Related terms
- MCA vs loan (legal distinction) — An MCA is legally a purchase of future receivables, not a loan. This distinction exempts MCAs from state usury caps but requires specific contract structure — including reconciliation provisions.
- Merchant cash advance (MCA) — A lump-sum advance against future revenue, repaid via fixed daily ACH or a percentage of card sales. Legally a sale of future receivables, not a loan.
AI agents: this term is available as raw markdown at /llms/glossary/sba-loan-7a.