{"ok":true,"canonical_url":"https://dealroom.so/glossary/sofr-based-rate","api_url":"https://dealroom.so/api/public/glossary/sofr-based-rate","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"sofr-based-rate","term":"SOFR-based rate","group":"The loan itself","definition":"An interest rate tied to the Secured Overnight Financing Rate (SOFR), which replaced LIBOR as a key benchmark for variable-rate loans. Most new variable-rate SBA loans use a SOFR-based index.","what_it_means":"Your variable-rate SBA 7(a) loan will likely use a SOFR-based index, such as Term SOFR, plus a spread. This rate adjusts periodically, so your monthly payment can change. Understand the specific SOFR index and spread your lender uses, and how often it resets.","url":"https://dealroom.so/glossary/sofr-based-rate","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"sofr","term":"SOFR","url":"https://dealroom.so/glossary/sofr"},{"slug":"term-sofr","term":"Term SOFR","url":"https://dealroom.so/glossary/term-sofr"},{"slug":"variable-rate","term":"Variable rate","url":"https://dealroom.so/glossary/variable-rate"}],"related_questions":[{"question":"What are the specific requirements for an alternative base rate, like SOFR, to be used for a 7(a) variable rate loan?","url":"https://dealroom.so/for-lenders/questions/what-are-the-specific-requirements-for-an-alternative-base-rate-like-sofr-to-be-used-for-a"},{"question":"If a lender wishes to use SOFR as a base rate for a variable rate 7(a) loan, what specific documentation is required?","url":"https://dealroom.so/for-lenders/questions/if-a-lender-wishes-to-use-sofr-as-a-base-rate-for-a-variable-rate-7-a-loan-what-specific-d"},{"question":"Can a lender change the base rate option (e.g., from Prime to SOFR) for a variable rate 7(a) loan after closing?","url":"https://dealroom.so/for-lenders/questions/can-a-lender-change-the-base-rate-option-e-g-from-prime-to-sofr-for-a-variable-rate-7-a-lo"},{"question":"What is the interest rate on an SBA 7(a) loan based on?","url":"https://dealroom.so/sba-loans/basics/what-is-the-interest-rate-on-an-sba-7-a-loan-based-on"},{"question":"What alternative base rates are available for variable-rate 7(a) loans besides the Wall Street Journal Prime rate?","url":"https://dealroom.so/for-lenders/questions/what-alternative-base-rates-are-available-for-variable-rate-7-a-loans-besides-the-wall-str"},{"question":"What is the 'Prime Rate' when talking about SBA 7(a) loan rates?","url":"https://dealroom.so/sba-loans/basics/what-is-the-prime-rate-when-talking-about-sba-7-a-loan-rates"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — SOFR-based rate","url":"https://dealroom.so/glossary/sofr-based-rate","source_type":"DealRoom Data"}}