SBA loan basics
Short answer
The maximum interest rate a lender can charge on an SBA 7(a) loan is capped by the SBA and is usually the Wall Street Journal Prime Rate plus a specified spread, which varies based on the loan amount and maturity.
The SBA imposes maximum allowable interest rates to protect borrowers. For loans over $50,000, the maximum allowable spread over the prime rate is 2.25% for loans with terms under 7 years, and 2.75% for loans with terms of 7 years or more. Lenders can charge less, but not more.
If the Wall Street Journal Prime Rate is 8.50% and a business has a $300,000 SBA 7(a) loan with a 10-year term, the maximum interest rate the lender can charge is 8.50% + 2.75% = 11.25%.
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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