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SBA lenders

Get resources, training, and guidance for SBA lenders, as well as information on SBICs, surety bonds and how to respond to fraud.

Become an SBA lender

As an SBA-certified lender, loans you issue will be backed by a federal guaranty. Review the eligibility requirements under each program, and then log in to begin the process.

Get started to become a lender

7(a) loan program

If you’re a member of a financial institution authorized by SBA to issue 7(a) loans, use this page to access SBA forms, get program updates, and more.

Learn about the 7(a) loan program

CDC/504 loan program

If your organization is designated by SBA as a CDC authorized to issue 504 loans, use this page to access SBA forms, get program updates, and more.

Learn about the CDC/504 loan program

Microloan program

Loans of $50,000 or less to help businesses and certain non-profit childcare centers. Microloans are provided by intermediary lenders.

Learn about the microloan program

Lender reports

If your organization is designated by SBA as an intermediary in its Microloan program, use this page to access SBA forms, get program updates, and more.

Browse our lender reports

Documents, forms, and SOPs

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Training on demand

Get smart on SBA’s business loan program policies.

Learn about training for lender

Lender and fraud response

All lenders who originate loans in PPP have an obligation to mitigate fraud, waste, and abuse in SBA programs.

Understand lender requirements for fraud response

Become an SBA lender

The U.S. Small Business Administration (SBA) guarantees that loans issued by its lending partners will be repaid, which offers benefits to lenders that standard loans do not.

  • Favorable rates and terms: An SBA guaranty enables you to offer lower rates and longer terms.
  • Security: SBA will purchase the guaranteed portion of a loan if a borrower defaults.
  • More clients: Work with borrowers you typically wouldn’t lend to without an SBA guaranty.

SBA has three business loan programs: 7(a), CDC/504, and Microloan. Each program has its own lending practices and eligibility requirements for lenders. Review the details of each, then decide which program is best for you.

7(a) loan program

Banks, savings and loans, credit unions, and other specialized lenders participate with SBA on a deferred basis to provide small business loans that are structured under 7(a) guidelines. If a borrower defaults on an SBA-guaranteed loan, the lender may ask SBA to purchase the guaranteed portion.

To participate in the 7(a) loan program, a lender must meet the following requirements:

  • Have a continuing ability to evaluate, process, close, disburse, service, and liquidate small business loans
  • Be open to the public to issue loans (and not be a financing subsidiary, engaged primarily in financing the operations of an affiliate)
  • Have continuing good character and reputation, and otherwise meet and maintain the ethical requirements as identified in 13 CFR Part 120.140
  • Be supervised and examined by a state or federal regulatory authority, satisfactory to SBA or apply as a Small Business Lending Company (SBLC) or Non-Federally Regulated Lender (NFRL) in accordance with SOP 50 56

CDC/504 loan program

A Certified Development Company (CDC) is a nonprofit corporation set up to contribute to the economic development of its community. CDCs are certified and regulated by SBA. They work with SBA and private-sector lenders to provide growing businesses with long-term, fixed-rate financing for major fixed assets, such as land, buildings, machinery, and equipment.

Typically, a project involving a 504 loan includes:

  • A loan secured from a private sector lender with a senior lien covering up to 50% of the project cost
  • A loan secured from a CDC — backed by a 100% SBA-guaranteed debenture — with a junior lien covering up to 40% of the total cost
  • A contribution from the borrower of at least 10% equity of the total project cost

To participate in the CDC/504 loan program, a lender must meet certain requirements, including but not limited to:

  • Be a nonprofit corporation in good standing
  • Have a board of directors with at least nine voting directors (additional board of directors requirements are listed in 13 CFR 120.823)
  • Have full-time professional management and a full-time professional staff
  • Meet a minimum level of lending activity

Microloan program

The Microloan program provides small businesses with small, short-term loans — up to $50,000 — for working capital or to buy inventory, supplies, furniture, fixtures, machinery and equipment. SBA makes funds available to specially designated intermediary lenders, which are non-profit organizations with experience in lending and technical assistance. These intermediaries then issue loans to eligible borrowers.

To participate in the Microloan program, a lender must meet the following requirements: 

  • Be a private nonprofit, quasi-public, or tribally-owned entity
  • Have at least one year of experience directly issuing and servicing microloans

Have at least one year of experience providing in-house marketing, management, and technical assistance to its micro-level borrowers

Loan programLoan sizeMaximum interest rateMaturityUse of proceeds
7(a)Up to $5 millionNegotiated between borrower and lender subject to SBA maximums10 years or less, unless financing or refinancing real estate or equipment with a useful life exceeding 10 years

25 years including extensions for real estate		Acquire land and build or renovate a building

Purchase machinery, equipment, supplies, furniture, fixtures

Make lease-hold improvements, expand or renovate facilities

Purchase permanent working capital, inventory

Acquire a business or partial ownership in a business

Start a business

Refinance certain existing debt
CDC/504$25,000 – $5.5 millionFixed interest25 years for real estate

10 years for equipment		Purchase or renovate capital assets (land, buildings, equipment)

Refinancing permitted
MicroloanMaximum of $50,000Negotiated between borrower and intermediaryNo more than 6 yearsPurchase working capital

Purchase furniture, fixtures, supplies, materials, equipment

Contact a lender relations specialist at your local SBA district office to start the application process.

7(a) program

Capital Access Financial System (CAFS)

CAFS is the primary system for loan origination and servicing for SBA’s loan programs. SBA lenders and other program participants access, submit, and service loans using a variety of applications available online through CAFS:

  • Electronic Lending – Origination (E-Tran) – Submit loan guaranty requests
  • Electronic Lending – Servicing (E-Tran) – Update/edit existing loans
  • 7(a) Connect – View and export portfolio information
  • FTA Portal – 1502 Reporting and Secondary Market functions
  • Partner Information Management System (PIMS) – Lender information
  • Lender Match – Referral tool for lenders and borrowers
  • Loan and Lending Monitoring System (LLMS) Portal – View quarterly performance data

Follow these step-by-step instructions to create a CAFS account.

Small Business Lending Company (SBLC) lists

SBLCs are non-depository lending institutions that are authorized by SBA to make 7(a) loans.

Community Advantage Small Business Lending Companies (CA SBLCs) are SBLCs that are mission-oriented and primarily non-profit financial intermediaries.

The SBLC and CA SBLC lending communities are encouraged to use the lists below to help identify their peers for networking, referral, and collaboration opportunities.

Lending lifecycle
Origination

Lenders may use a business credit scoring model, credit score, or credit history of the applicant, associate(s), and guarantors; cashflow, equity, or collateral may also be a consideration. Applicants must be credit worthy and certify to certain program eligibility requirements; loans must be sound with a reasonable assurance of repayment ability. 

Lenders digitally submit loan guaranty requests online; SBA will make the final determination as to the eligibility of the applicant.

SBA’s eligibility and credit standards begin with the requirements outlined in 13 CFR Part 120. Policies and procedures surrounding loan origination are covered by SOP 50 10.

Closing

Lenders are expected to close 7(a) loans the same way they close non-SBA loans. Lenders are responsible for knowing how to properly close loans, secure collateral, obtain and perfect the required lien positions, in addition to meeting any other loan closing requirements. See SOP 50 10 for additional information.

Servicing

Lenders have unilateral authority to take routine actions to service and liquidate the 7(a) Loans in their portfolio, while changes to the terms and conditions of a loan may or may not require prior approval. Loan actions are conditioned by whether the guaranteed portion of the Loan has been sold in the Secondary Market.

When taking a unilateral action, lenders notify SBA through E-Tran or email to the Service Center. 

The Commercial Loan Service Center (CLSC) in Fresno also addresses loan servicing requests from lenders where SBA approval is required.

Whether taken unilaterally or with written consent from the Center, all loan actions must be documented with the request, justification, analysis, and all documents relied upon to make the decision memorialized in the loan file. See SOP 50 57 for additional information.

Liquidation

Lenders must classify the loan as “In Liquidation” on their monthly SBA Form 1502 Report when they accelerate the note or receive a notice that the borrower has filed for bankruptcy protection. Information regarding loan liquidation as well as requesting SBA honor the guaranty is covered by SOP 50 57.

Types of 7(a) loans

SBA may grant delegated authority to lenders to process, close, service, and liquidate certain 7(a) loans without prior SBA review.

Standard 7(a)

Standard 7(a) Loans are 7(a) loans that are greater than $350,000, and exclude 7(a) Small, SBA Express, Export Express, CAPLines, Export Working Capital Program (EWCP), International Trade loans, and Pilot Program loans. 

These loans may be processed under Preferred Lender Program (PLP) delegated authority or non-delegated through the Loan Guaranty Processing Center (LGPC).

Loan termsDetails
Loan amount$350,001 to $5 million
Maximum SBA guarantee %75%
Interest rateLenders and borrowers can negotiate the interest rate, but it may not exceed the SBA maximum
Revolving lines of creditPermitted only under SBA Express, Export Express, or CAPLines
SBA turnaround time5-10 business days
FormsSBA Form 1919 is required for every loan
CollateralSBA considers a loan “fully secured” if the lender has taken security interests in all assets being acquired, refinanced, or improved with the 7(a) loan and available fixed assets of the applicant with a combined adjusted net book value up to the loan amount. Other conditions apply – see SOP 50 10 for more details.
Credit decisionBy SBA or qualified lenders may be granted delegated authority to process, close, service, and liquidate the loan without SBA review.
7(a) small

7(a) Small loans are term (non-revolving) 7(a) loans that are $350,000 or less and may be processed under Preferred Lender Program (PLP) delegated authority or non-delegated through the LGPC. 

7(a) Small loans exclude: Standard 7(a) loans, SBA Express, Export Express, CAPLines, Export Working Capital Program (EWCP), and Pilot Program loans.

Loan termsDetails
Maximum loan amount$350,000
Maximum SBA guarantee %85% for loans up to $150,000 and 75% for loans greater than $150,000
Interest rateLenders and borrowers negotiate the interest rate, but it may not exceed the SBA maximum
SBA turnaround time2-10 business days
FormsSBA Form 1919 is required for every loan
CollateralFor loans $50,000 or less: SBA does not require collateral, except for International Trade loans, which have different requirements.For loans $50,001 to $500,000: Lender must follow the written collateral policies and procedures that it has established and implemented for its similarly-sized, non-SBA guaranteed commercial loans; however, a loan is not to be declined solely on the basis of inadequate collateral.
Credit decisionBy SBA or qualified lenders may be granted delegated authority to process, close, service, and liquidate the loan without SBA review.
SBA Express

The SBA Express allows certain lenders to generally use their own processes and procedures in exchange for a lower SBA guaranty percentage. SBA Express lenders have delegated authority to process, close, service, and liquidate the 7(a) loan without SBA review.

Loan termsDetails
Maximum loan amount$500,000
Maximum SBA guarantee %50%
Interest rateLenders and borrowers can negotiate the interest rate, but it may not exceed the SBA maximum
Revolving lines of creditUp to 10 years
FormsLender primarily uses own forms and procedures, plus SBA Form 1919
CollateralLenders are not required to take collateral for loans up to $50,000. May use their existing collateral policy for loans over $50,000 except that a loan is not to be declined solely on the basis of inadequate collateral.
Credit decisionMade by the lender
Export Express

The Export Express Loan Program guarantees smaller dollar revolving lines of credit or term loans to support small business concerns that wish to develop the export side of their business. It offers many of the streamlined features of SBA Express while providing a higher guarantee to mitigate international credit risk.

Loan termsDetails
Maximum loan amount$500,000
Maximum SBA guarantee %90% for loans of $350,000 or less, 75% for loans more than $350,000
InterestLenders and borrowers can negotiate the interest rate, but it may not exceed the SBA maximum
Revolving lines of creditMay not exceed seven years
FormsLender primarily uses own forms and procedures, plus SBA Form 1919
CollateralLenders are not required to take collateral for loans up to $50,000. May use their existing collateral policy for loans over $50,000 except that a loan is not to be declined solely on the basis of inadequate collateral.
Credit decisionMade by the lender

SBA Senior International Credit Officers can provide in-house training to help lenders become proficient in the Export Express program. For more information on this training or for application assistance, contact your local U.S. Export Assistance Center.

Export Working Capital

7(a) Export Working Capital Program (EWCP) loans are for businesses that can generate export sales and need additional working capital to support these sales. Lenders can receive assistance from the U.S. Export Assistance Center location servicing the exporter’s region.

Loan termsDetails
Maximum loan amount$5 million
Maximum SBA guarantee %90%
InterestLenders and borrowers negotiate the interest rate and there is no SBA maximum interest rate limit.
Revolving lines of creditTerms of 36 months or less
FormsSBA Form 1919
CollateralIn general, the export-related inventory produced and the foreign accounts receivables generated by the export sales financed will be considered to provide adequate collateral coverage.
Credit decisionBy SBA or qualified lenders may be granted delegated authority to process, close, service, and liquidate the 7(a) loan without SBA review.
International Trade

Under the 7(a) International Trade loan program, SBA guarantees term loans to improve the competitive position of small business concerns that are existing exporters or are developing new export markets. SBA also guarantees term loans to improve the competitive position of any small business concerns adversely affected by import competition.

Businesses can use International Trade loans to acquire, construct, renovate, modernize, improve, or expand facilities and equipment to be used in the United States to produce goods or services involved in international trade and to develop and penetrate foreign markets, and for working capital for export transactions.

Loan termsDetails
Maximum loan amount$5 million
Maximum SBA guarantee %90%
Interest rateLenders and borrowers can negotiate the interest rate, but it may not exceed the SBA maximum
SBA turnaround time5-10 business days
Credit decisionBy SBA or qualified lenders may be granted delegated authority to process, close, service, and liquidate the 7(a) loan without SBA review.
Manufacturers’ Access to Revolving Credit (MARC) Loans

MARC loans are available only to eligible small businesses that meet the SBA’s eligibility requirements, and are engaged in manufacturing (NAICS sectors 31-33, where 31, 32, or 33 are the first two digits of the business’s 6-digit NAICS code). MARC loans contain features of both Standard 7(a) term and SBA Express revolving loans. MARC loans may be term or revolving. They are underwritten like a Standard 7(a) loan, and the monitoring requirements are similar to those of SBA Express loans.

For revolving loans, the Lender must conduct an annual review of the borrower’s financials. If the results of the annual review are unsatisfactory, the line must be converted to a fully amortizing term loan with a zero balance at loan maturity. Once the loan has been converted to a term loan, the Lender may not make further disbursements on the line.

Complete program details on the MARC is hereby incorporated into SOP 50 10 8 as Appendix 13.

Loan termsDetails
Maximum loan amount$5 million
Maximum SBA guarantee %85% for loans up to $150,000 and 75% for loans greater than $150,000
Interest rateLenders and borrowers can negotiate the interest rate, but it may not exceed the SBA maximum
Revolving lines of creditRevolving loans may have a maturity of up to 20 years (10 years revolving, 10 years term). Term loans may have a maturity of up to 10 years.
FormsLender primarily uses own forms and procedures, plus SBA Form 1919
CollateralAt a minimum, the Lender must place a lien on all business assets with exceptions for vehicles and trading assets.
Credit decisionMade by the lender
CAPLines

CAPLines is an umbrella program that helps small businesses meet their short-term and cyclical working-capital needs. See SOP 50 10 for specific details.

  • Seasonal CAPLine: finances the seasonal increases of accounts receivable and inventory — or in some cases associated increased labor costs. The loan may be revolving or non-revolving.
  • Contract CAPLine: finances the costs of one or more specific contracts, including overhead or general and administrative expenses, allocable to the specific contract(s). The loan may be revolving or non-revolving.
  • Builders CAPLine: provides financing to small general contractors to construct or rehabilitate residential or commercial property for resale. This program provides an exception under specified conditions to the general rule against financing investment property. “Construct” and “rehabilitate” mean only work done on-site to the structure, utility connections, and landscaping.
  • Working CAPline: provides an asset-based revolving line of credit for businesses unable to meet credit standards associated with long-term credit. It provides financing for cyclical growth, recurring and/or short-term needs. Repayment comes from converting short-term assets into cash, which is remitted to the lender. Businesses continually draw from this line of credit, based on existing assets, and repay as their cash cycle dictates. This line generally is used by businesses that provide credit to other businesses. Because these loans require continual servicing and monitoring of collateral, additional fees may be charged by the lender.

With the exception of the Builders CAPLine, the maximum maturity on a CAPLine loan is 10 years. Builders CAPLine loans must not exceed 60 months plus the estimated time to complete construction or rehabilitation.

Working Capital Pilot (WCP)
Benefits

Lines of credit are the most flexible and affordable way for businesses to manage their working capital needs. With a line of credit, interest is only charged when the loan is in use, making it the most efficient way to access working capital.

SBA’s 7(a) WCP is a pilot loan program offering monitored lines of credit within the 7(a) loan program. The 7(a) WCP can support a range of financing needs for growing small businesses and brings together the best features of the existing permanent 7(a) line of credit delivery methods. In addition, the 7(a) WCP introduces a series of innovative features:

New annual fee structure
  • The 7(a) WCP has a fee structure modeled after SBA’s 7(a) Export Working Capital Program (EWCP)
  • Using an annual short-term guaranty fee, the 7(a) WCP fee structure charges a proportional amount for each year the facility is in use
  • Establishing an annual guaranty fee structure allows borrowers to customize the line to their exact needs, paying only for the time that they require
Support for transaction-based lending
  • The 7(a) WCP can support project financing, allowing a borrower to access the working capital at an earlier point than they would under a traditional line of credit
  • Through this unique financing method, the 7(a) WCP can enable a borrower to access funding earlier in their sales cycle
  • With the support of a Transaction Based 7(a) WCP, small businesses can take on transformational opportunities with the confidence they can cover all related costs
Support for asset-based lending
  • The 7(a) WCP is positioned to help small businesses access the working capital they need to support and grow their business
  • Using a 7(a) WCP, small businesses can efficiently borrow against their accounts receivable and inventory
  • The 7(a) WCP will also help transition borrowers from SBA Express loans into a larger working capital facility to support their growth
A new take on export finance
  • The 7(a) WCP can provide working capital against domestic and international orders under a single loan facility
  • New-to-export firms will be able to use the 7(a) WCP to open international markets without having to obtain a separate line of credit
One-on-one counseling
  • SBA offers one-on-one counseling with SBA’s Finance Managers, subject-matter experts who will guide lenders and businesses through their working capital transactions
Loan terms
Maximum loan size$5,000,000
Maximum SBA guaranty %85% for loans up to $150,000
75% for loans greater than $150,000
MaturityUp to 60 months
ProcessingNon-delegated authority
Preferred Lender Program (PLP) – WCP Delegated Authority
Interest rates$50,000 or less: cannot exceed base rate + 6.5%
$50,001 – $250,000: cannot exceed base rate + 6.0%
$250,001 – $350,000: cannot exceed base rate + 4.5%
$350,001 and greater: cannot exceed base rate + 3.0%
How to participate in the 7(a) WCP

Lenders currently approved to process 7(a) loans can begin processing 7(a) WCP loans on August 1, 2024. Lenders with delegated EWCP authority will be immediately provided with delegated authority to make 7(a) WCP loans. Lenders who do not maintain delegated EWCP authority may apply for delegated 7(a) WCP status with the requirements outlined in the Program Guide.

SBA encourages lenders to request support from their local Finance Managers for individual transactions (including domestic transactions) as needed.

Eligibility requirements

In addition to the core requirements identified in SOP 50 10, Section A, the following 7(a) WCP-specific eligibility requirements apply:

  • Limited to businesses that
    • Have a history of 12 full months of operations prior to filing an application
    • If supporting an acquisition – the acquiring borrower must have a history of 12 full months of operations prior to filing an application
    • Can produce timely and accurate financial statements, accounts receivable and accounts payable agings, and inventory reports
  • The lender must obtain updated financial statements on the borrower annually and perform a full credit analysis as part of any renewal
  • As a lender offering the WCP program, it is important that the institution have the operational controls necessary to administer the monitoring requirements, which mirror industry standards for asset-based facilities

The U.S. Small Business Administration (SBA) guarantees that loans issued by its lending partners will be repaid, which offers benefits to lenders that standard loans do not.

Secondary Market Program and Securitization Guide

The Secondary Market Program and Securitization Guide outlines the methods for Secondary Market sales of loan and pool certificate interests. The Guide also explains the primary functions of SBA’s Fiscal and Transfer Agent (FTA) and the securitization of unguaranteed loan interests into separate securities.

Secondary Participation Guaranty Agreement

Lenders participate in the Secondary Market Program by using SBA Form 1086 (executed by the lender, the investor, the Fiscal Transfer Agent, and SBA) to sell the guaranteed portion of a loan.

This Secondary Participation Guaranty Agreement is a contract that details the terms and conditions of the sale of the guaranteed portion of an SBA loan. The document provides sale data and related rights and responsibilities of all parties to the transaction and is used for each individual loan sale made by an SBA Lender.  

Active 7(a) loan pool assemblers

SBA maintains an updated list of its approved active 7(a) loan pool assemblers. The list also provides the primary point of contact for each active pool assembler to address any questions that may arise from the lenders or investors.

Schedule of 1502 report and payment due dates

View the 1502 Report and Payment due dates for 7(a) Loans at the FTA wiki. The purpose of this notice is to inform SBA employees and lenders about the SBA Form 1502 report and payment due dates.

Multi-party agreements

These template agreements are used for secured credit and SBA securitizations involving 7(a) loans. You must submit these documents with requests for the SBA’s approval for these types of financing.

Fiscal Transfer Agent (FTA)

Guidehouse serves as FTA for SBA’s 7(a) loan program. As FTA, Guidehouse is the central registry for all guaranteed individual loan and SBA pool certificate interests. Guidehouse also serves as SBA paying agent for all investor payments, and processes lender loan reporting and payment remittance reconciliations.  Guidehouse can be reached at FTA@SBA.gov.

The specific terms of 7(a) loans are negotiated between the borrower and the participating lender, subject to the requirements of the SBA. In general, the following provisions apply to all SBA 7(a) loans.

Eligibility requirements

While the vast majority of businesses are eligible for financial assistance from SBA, some are not.

Eligible businesses must:

  • Be an operating business
  • Operate for profit
  • Be located in the U.S.
  • Be small under SBA size requirements
  • Not be a type of ineligible business
  • Not be able to obtain the desired credit on reasonable terms from non-federal, non-state, and non-local government sources.
  • Be creditworthy and demonstrate a reasonable ability to repay the loan.

Use of loan proceeds

7(a) loans can be used for: 

  • Acquiring, refinancing, or improving real estate and/or buildings
  • Short- and long-term working capital 
  • Refinancing current business debt 
  • Purchasing and installation of machinery and equipment
  • Purchasing furniture, fixtures, and supplies
  • Changes of ownership (complete or partial)
  • Multiple purpose loans, including any of the above

Loan amounts

Most 7(a) loans have a maximum loan amount of $5 million. However, 7(a) loans made under the SBA Express and Export Express delivery methods have maximum loan amounts of $500,000.

SBA’s maximum exposure (i.e., dollars guaranteed) is $3.75 million. However, 7(a) International Trade loans may receive a maximum guaranty of 90% or $4.5 million. The amount guaranteed for working capital for the International Trade loan combined with any other outstanding 7(a) loan for working capital cannot exceed $4 million.

Percentage of guaranty

For most 7(a) loan programs, SBA guarantees up to 85% of loans of $150,000 or less, and up to 75% of loans above $150,000. However, SBA provides a 50% guaranty on SBA Express loans. SBA provides a 90% guaranty for Export Express, Export Working Capital Program (EWCP), and International Trade loans.

Maturity terms

The term of a 7(a) loan will be: 

  • The shortest appropriate term, depending upon the borrower’s ability to repay; 
  • Ten years or less, unless it finances or refinances real estate or equipment with a useful life exceeding ten years. The term for a loan to finance equipment and/or leasehold improvements may include an additional reasonable period, not to exceed 12 months, when necessary to complete the installation of the equipment and/or complete the leasehold improvements. 
  • A maximum of 25 years, including extensions. (A portion of a loan used to acquire or improve real property may have a term of 25 years plus an additional period needed to complete the construction or improvements.).

Interest rates

Interest rates for 7(a) loans are negotiated between the borrower and the lender, but are subject to SBA maximums, which are pegged to the prime rate or an optional peg rate. Interest rates may be fixed or variable.

SBA publishes the maximum fixed interest rates on SBA’s FTA wiki. 

The maximum interest rates for variable 7(a) loans are as follows:

Loan amountMax rate
$50,000 or lessBase rate plus 6.5%
$50,001 to $250,000Base rate plus 6.0%
$250,001 to $350,000Base rate plus 4.5%
Greater than $350,000Base rate plus 3.0%

Fees

Fees the lender pays SBA

Lenders must pay an Upfront Fee (also known as an SBA Guaranty Fee) for each loan guaranteed under the 7(a) program but are permitted to pass the cost of the fee on to the borrower. 

Lenders must pay the Lender’s Annual Service Fee (also known as the SBA On-Going Guaranty Fee) based on the outstanding principal balance of the guaranteed portion of a loan at the time of SBA loan approval. This fee cannot be charged to the borrower.

SBA publishes the amount of the Upfront Fee and the Lender’s Annual Service Fee each fiscal year for all loans approved during that year through an Information Notice. 

Fees lenders and agents may charge the borrower

SOP 50 10 and the regulation at 13 CFR 120.221 contain information on fees lenders and agents may charge the borrower.

Prepayment penalties

For loans with a maturity of 15 years or longer, prepayment penalties apply when:

  • The borrower voluntarily prepays 25% or more of the outstanding balance of the loan.
  • The prepayment is made within the first three years after the date of the first disbursement of the loan proceeds.

The prepayment fee is:

  • During the first year after disbursement, 5% of the amount of the prepayment.
  • During the second year after disbursement, 3% of the amount of the prepayment.
  • During the third year after disbursement, 1% of the amount of the prepayment.

Contact a lender relations specialist at your local SBA district office to start the application process.

The SBA franchise directory helps lenders and CDCs to evaluate the eligibility of small businesses that operate under a franchising agreement.

CDC/504 program

Resources for CDCs

Lender portal login

SBA’s lender portal allows CDCs to view their own quarterly performance data, including their most current composite risk rating, the lender risk rating. CDCs can also access data on peer group and portfolio averages.

E-Tran

E-Tran is SBA’s online portal which CDCs can use to electronically submit loan guaranty packages and loan servicing request packages. CDCs may also use E-Tran to submit certain servicing actions using their unilateral authority.

To get an E-Tran account, apply online or email your request for an account to CLS@sba.gov.

Lending lifecycle

Approval-authorization

The Sacramento Loan Processing Center (SLPC) reviews all 504 loan applications. If an SBA loan officer needs additional information, documentation, or explanation, the SLPC will contact the CDC via email.

The authorization is SBA’s written agreement with the CDC providing the terms and conditions under which SBA will guarantee a business loan.

SBA establishes the wording for all standard 504 authorization conditions in the National 504 Authorization Boilerplate. Use the boilerplate as a template when you submit an authorization package.

The 504 authorization wizard makes it easier for you to create authorizations based on the boilerplate. If you’re unable to install the wizard, contact SBA at auth-504@sba.gov.

Closing

CDCs and SBA must use SBA Form 2286 for all 504 debenture closings.

Servicing loans

A loan moves from “approval” status to “regular servicing” status when the following three conditions are met

  • It’s closed in accordance with the terms and conditions of the loan authorization
  • The final disbursement has been made
  • SBA’s guaranty fee has been paid

The Commercial Loan Service Centers (CLSC) in Fresno and Little Rock address loan servicing requests from CDCs. If you have a servicing request, submit it to the appropriate center that’s handling the loan.

However, you may take some servicing actions without prior approval from SBA. Even if an action doesn’t require SBA’s prior approval, you must document the reasons for your decisions. Keep those documents for SBA to review.

504 liquidation

For 504 loans made under the Premier Certified Lenders Program (PCLP), or if the CDC is a designated Authorized CDC Liquidator (ACL), the CDC is primarily responsible for liquidating the loan. Otherwise, CLSCs are primarily responsible for liquidation.

Debenture purchase

You should ask the appropriate CLCS to purchase the debenture and place the loan into liquidation status when:

  • The loan is 60 or more days past due with no prospect of a deferment or a work out.  
  • The third party lender or other senior lien holder has initiated foreclosure proceedings.
  • A bankruptcy, or other legal action which will adversely affect repayment of the 504 loan, has been initiated.

You must make a site visit and submit a detailed report to SBA within 15 days of SBA placing the loan into liquidation status.

Liquidation plan

After a site visit, you should prepare a 504 liquidation plan. Prepare the liquidation plan before you take any significant action to liquidate the loan. Submit the plan to SBA within 30 days after the purchase of the debenture.

Expenses

SBA will reimburse you for recoverable expenses relating to the liquidation of the loan subject to:

  • Requests must be submitted electronically.
  • A separate request must be submitted for each individual loan.
  • Recoverable expenses can only be submitted when the aggregate total is $5,000 or more, or at the time the wrap-up report is submitted.
  • Copies of invoices and other supporting documentation must be included.
  • Requests may be submitted with the wrap-up report, regardless of dollar amount.
Offer in Compromise (OIC)

An OIC is a monetary offer typically made at the end of the liquidation of all business and other worthwhile assets. When the borrower is unable to pay their SBA loan in full after liquidation of all worthwhile collateral, it may be appropriate to settle for less than the full amount due.

If you want SBA to consider an OIC, submit your request using the OIC tabs.

Wrap-up report

You must submit a 504 liquidation wrap-up report to SBA within 90 days of completing all reasonable and cost-effective recovery efforts.

Litigation

ACLs and PCLP CDCs are responsible for conducting all litigation needed to ensure recovery on all of the 504 Loans in their portfolios. You must submit a 504 litigation plan to SBA for review and approval.

For non-ACLs and non-PCLP CDCs, SBA is responsible for handling litigation on 504 loans.

504 debt refinancing program

Small businesses can use the CDC/504 loan program to refinance qualifying existing debt in any year that the program is at zero subsidy. Borrowers are able to refinance up to 90% of the current appraised property value. The refinancing may also include eligible business expenses, with a maximum loan to value of 85%.

To qualify for refinancing, a business must have been in operation for at least two years. Additionally, the debt to be refinanced must be a commercial loan:

  • That was incurred for the benefit of the small business concern not less than two years before the date of the 504 debt refinancing application
  • The proceeds of which were used to acquire a 504 eligible fixed asset
  • That is secured by 504 eligible fixed assets
  • For which the borrower has been current on all payments for at least the last 12 months prior to application

Existing 504 projects and government-guaranteed loans are not eligible to be refinanced.

The Small Business Administration guarantees debentures issued by CDCs.  SBA debentures are securitized into Debenture Pools which are sold to investors as Development Company Participation Certificates (DCPCs). SBA guarantees the full faith and credit and timely payment on these certificates.

Debenture funding schedule

View SBA’s Information Notice regarding the Debenture Funding Schedule for 504 Loans – Calendar Year 2022. The schedule dates include the sale of both 10- and 20-year debentures.

Fiscal and Selling Agent (FSA)

Eagle Compliance, LLC serves as FSA for SBA’s CDC/504 loan program. As FSA, Eagle provides services and administrative support to SBA and CDCs related to the sale of 504 debentures and debenture pool certificates.

The SBA franchise directory helps lenders and CDCs to evaluate the eligibility of small businesses that operate under a franchising agreement.

Find Certified Development Companies (CDCs) authorized to issue 504 loans.

Microloan program

Conditions between intermediaries and SBA

Loan amount

An intermediary may not borrow more than $750,000 in its first year in the program. In later years, the intermediary’s obligation to SBA may not exceed an aggregate of $5 million, subject to statutory limitations on the total amount of funds available per state.

The intermediary must contribute, from non-federal sources, an amount equal to 15% of any loan that it receives from SBA. The contribution may not be borrowed. For purposes of this program, Community Development Block Grants are considered non-Federal sources.

Repayment terms

During the first year of the loan, an intermediary is not required to make any payments, but interest accrues from the date that SBA disburses the loan proceeds to the intermediary. After that, SBA will determine the periodic payments. The loan must be repaid within 10 years.

Interest rate

The interest rate is equal to the rate applicable to five-year obligations of the U.S. Treasury Department, adjusted to the nearest 0.125%, less 1.25%. Intermediaries that maintain an average loan size of $10,000 or less may qualify as specialized intermediaries. The interest rate for specialized intermediaries is equal to the rate applicable to five-year obligations of the U.S. Treasury Department, adjusted to the nearest 0.125%, less than 2%.

Collateral and default

As security for repayment of SBA loan, an intermediary must pledge to SBA a first lien position in the Microloan Revolving Fund and Loan Loss Reserve Fund (see definitions below), and all notes receivable from Microloans. If an intermediary is unable to pay SBA, or violates the terms of its loan agreement, SBA may demand payment in full.

The intermediary isn’t required to pay SBA any loss or deficiency that may remain after liquidation of the collateral, unless the loss was caused by fraud, negligence, violation of any of the ethical requirements, or violation of any other provision of this part.

Microloan Revolving Fund (MRF)

The MRF is an account into which an intermediary must deposit the proceeds from SBA loans, its contributions from non-federal sources, and payments from its Microloan borrowers. An intermediary may only withdraw from this account the money needed to establish the Loan Loss Reserve Fund, proceeds for each Microloan it makes, and any payments to be made to SBA.

Loan Loss Reserve Fund (LLRF)

The LLRF is an account that an intermediary must maintain in order to pay any shortage in the MRF caused by delinquencies or losses on Microloans. The balance on the LLRF must equal 15% of the balance owed to it by its Microloan borrowers.

After an intermediary has been in the Microloan program for five years, it can request that SBA allow it to reduce the amount in its LLRF to as little as 10% of its portfolio.

Conditions between intermediaries and borrowers

An intermediary may only make Microloans to eligible small businesses. Proceeds from Microloans may be used only for working capital and acquisition of materials, supplies, furniture, fixtures, and equipment. SBA doesn’t review Microloans for creditworthiness.

Amount and maturity

Generally, intermediaries should not make a Microloan of more than $10,000 to any borrower. An intermediary may not make a Microloan of more than $20,000 unless the borrower demonstrates that it is unable to obtain credit elsewhere at comparable interest rates and that it has good prospects for success.

An intermediary may not make a Microloan of more than $50,000, and no borrower may owe an intermediary more than $50,000 at any one time. Each Microloan must be repaid within six years.

Interest rate

The maximum interest rate that can be charged to a Microloan borrower is as follows:

Loan amountMaximum interest rate
More than $10,000The interest rate charged on SBA loan to the Intermediary, plus 7.75%.
$10,000 or lessThe interest rate charged on SBA loan to the Intermediary, plus 8.5%.

Technical assistance

An intermediary can ask SBA for assistance to improve its knowledge, skill, and understanding of microlending. SBA awards a grant to a more experienced intermediary, which assists the inexperienced intermediary.

SBA can also provide technical assistance for prospective intermediaries in areas of the country that are either not served or underserved by an existing intermediary.

Find authorized intermediary lenders participating in SBA’s microloan program.

Lender reports

Using the links below, you can specify additional filters, and download results in spreadsheet or CSV format.

For more information, see the full lender activity reports (updated monthly).

Training on demand

Lender training

Archive: Past 7(a) Connect quarterly update recordings

Archive: Past 504 Connect quarterly update recordings
  • Office of General Counsel – September 10, 2025, CDC Environmental Training: 504 Loan Program (topics include: CDC’s role in SBA Environmental Policies and Procedures, SOP 50 10 8 Requirements, SBA Environmental Policies, and the appeals process and exceptions handled by the Environmental Committee.
  • 504 Connect Quarterly Update – September 9, 2025, SBA 504 loan program topics include: 7(a) and 504 Fees, Debanking Letter, Regional Innovation Cluster Funding Supporting Domestic Manufacturing, 504 Debenture Funding Schedule, Interest Rate Forecasting/Fiscal Selling Agent.
  • 504 Connect Quarterly Update – June 10, 2025, for the SBA 504 loan program (topics include: Introduction to the Associate Administrator, Thomas Kimsey. Made in America Manufacturing Initiative, Rate trends by Fiscal and Selling Agent, CDC Self-Certification of Energy Audits, OGC Franchise Review Process, OCRM CDC Annual Report Guide, and Updated 504 Funding Process.
  • 504 Connect Quarterly Update – March 11, 2025, for the SBA 504 loan program (topics include: Introduction to Deputy Associate Administrator, Dianna Seaborn, Citizenship Verification, OCRM SBA Lender Portal, OPSM LLMS Portal and Redwood Scores
  • 504 Connect Quarterly Update – September 10, 2024, for the 504 loan program (topics include: 504 Debt Refinance Direct Final Rule, Procedural Notice 5000-857268, Debenture Calendar, Market Trends by Eagle Compliance, ETRAN Technical Enhancements by OPSM, Protective BID training by OFPO, and Re-opening of New Applications for CA SBLC’s by OCRM
  • 504 Connect Quarterly Update – June 11, 2024, for the 504 loan program (topics include: Cap removal on Energy Public Policy Projects, Procedural Notice 5000-856893 update to SOP 50 56 1 related to form 1081, Policy on passive companies regarding office suites, OCRM and OPSM training, and NADCO Success Stories-50 States)
  • 504 Connect Quarterly Update – March 12, 2024 for the 504 loan program (topics include PPP and EIDL, Size Standards update, and SOP 50 10 7.1 update)
  • 504 Connect Quarterly Update – December 12, 2023 for the 504 loan program (topics include: SOP 50 10 7.1 Follow Up, New Compliance Codes, Office of Credit Risk Management Training)
  • 504 Connect Quarterly Update – September 19, 2023 for the 504 loan program (topics include: ETRAN updates, Validation error resolution, Fraud Risk Framework, Credit Alert Verification Reporting System, and CA SBLC transition)

Lenders and fraud response

All lenders who originate loans have an obligation to mitigate fraud, waste, and abuse in SBA programs.  In addition, PPP lenders are required to follow existing U.S. Department of Treasury guidance with regards to reporting suspicious activity.  The Department of the Treasury’s Financial Crimes Enforcement Network provides guidance for SBA lenders and other financial institutions on combatting fraud, waste, and abuse in COVID-19 relief programs.

What lenders can do: