SBA loan basics
Short answer
SBA 7(a) loan interest rates can be either fixed or variable. Variable rates are typically tied to a base rate like the Wall Street Journal Prime Rate, plus a spread.
The SBA sets maximum allowable interest rates for 7(a) loans, which are negotiated between the borrower and the lender. For variable rates, the rate is usually indexed to the Prime Rate, with an additional margin (the 'spread') allowed by the SBA. Fixed rates are less common but can be offered. The maximum allowable spread depends on the loan amount and term.
A borrower secures a $300,000 variable-rate 7(a) loan. The rate might be set at Prime + 2.75%. If the Prime Rate is 8.5%, the initial interest rate would be 11.25%. If the Prime Rate changes, so does the loan's interest rate.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
7(a) Loan Program — Terms, Conditions, and Eligibility
U.S. Small Business Administration · Official SBA source
SOP 50 10 - Lender and Development Company Loan Programs
7(a) Alternative Base Rate Options
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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