SBA loan basics
Short answer
The interest rates for SBA 7(a) loans are set by the individual lenders (banks) within maximum limits established by the SBA.
The SBA sets a maximum allowable interest rate for 7(a) loans, which is tied to a base rate (like the Prime Rate, SOFR, or Term SOFR) plus an allowable spread. Lenders then determine the specific rate for each borrower based on creditworthiness, risk, and prevailing market conditions, ensuring it does not exceed the SBA's maximum.
If the Prime Rate is 8.50%, the SBA might allow a maximum spread of 2.75% for a large loan. A bank could offer a borrower a rate of Prime + 2.25% (10.75%), which is below the SBA's maximum.
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
SBA 7(a) Loans Overview
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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