Small businesses need capital for many different purposes to expand or maintain their operations, and the SBA offers a multitude of different loan types for different purposes and for different types of companies.
SBA loans are organized into 4 main categories: 7(a) Loans, 504 Loans, Microloans, and Disaster Loans. As a rule of thumb, 504 loans are best for large real estate or equipment loans, 7(a) loans are best for business acquisitions or large working capital amounts, Microloans are best for startups, and Disaster Loans are best for emergencies.
Those categories are broken down into 19 specific loan types, and the key details of each loan type are summarized in the table below. Some details of the loans such as interest rates and fees are dependent upon the specific SBA lending partner and your own financial situation, so I recommend first finding the loan type most applicable to your situation from the table below and then contacting at least 3 different lenders about that specific type of loan to compare the deals you can get before making a decision to accept funding.
| Loan Type | Use of Funds | Max Loan Amount | Key Eligibility Requirements | Other Details |
| Microloan | Allowed – Working capital – Inventory – Supplies & materials – Furniture & fixtures – Machinery / equipment Not Allowed – Purchase real estate – Pay existing debts | $50,000 | Must be a for profit business or non-profit childcare center with a U.S. presence, but most other eligibility requirements are determined by the specific lender. | Terms up to 6 years SBA Microloan Program Info Page SBA Search by State for Microloan Lenders |
| Standard 7(a) | Allowed – Working capital – Refinance current eligible business debt – Supplies & materials – Furniture & fixtures – Purchasing land or real estate for owner-occupied commercial use – Construction or renovation of commercial real estate for owner occupation – Establishing a new business – Acquiring, operating, or expanding an existing business * Any acquired business must generally be profitable and have existed for at least 2 years. Not Allowed – Purchase an investment property | $5 million | – Be a for profit business – Be a “small business” by SBA definition (varies by industry) – Engaged in U.S. business – In an eligible industry – “Reasonable” invested equity – Not deliquent on any existing debts to U.S. gov – No non-SBA funding available – Generally, business owner(s) should have at least a 680 credit score | Terms – Up to 10 years for equipment, working capital, or inventory loans – Up to 25 years for real estate loans You must apply through an SBA partnered private lender. Qualifying can be difficult. SBA 7(a) Loan Program Overview Top 100 SBA 7(a) Lenders |
| 7(a) Small Loan | Substantially the same as standard 7(a) uses | $350,000 | Take an easy SBA pre-screening to be fast-tracked for approval. If you fail the fast track, you’ll have to go through the more intensive standard 7(a) process | Lenders may not advertise this as separate from 7(a) lending but may instead simply use the fast-track 7(a) small application whenever you apply for under $350k |
| 7(a) SBA Express | Substantially the same as standard 7(a) uses | $350,000 | Determined by lender | SBA Express Website |
| 7(a) Export Express | Allowed – Develop export business – Participate in a foreign trade show – Translate product literature for use in foreign markets – Finance specific export orders – Finance expansions, equipment purchases, inventory, or real estate acquisitions related to business exports | $500,000 | – All standard 7(a) requirements, plus – Business has been in operation at least 12 months | May be a term loan or revolving credit line SBA Export Express Fact Sheet |
| 7(a) Export Working Capital Program (EWCP) | Allowed – Manufacturing costs of goods for export – Purchasing goods or services for export – Support Standby Letters of Credit to act as bid or performance bonds – Finance foreign accounts receivable | $5 million | – All standard 7(a) requirements, plus – Business is engaged in export or can provide a valid plan to expand business into export activities | Loan maturities typically 12 months or less SBA Export Working Capital Fact Sheet |
| 7(a) International Trade Loan (ITL) | Allowed – Working capital related to entering or expanding into foreign markets – Purchase, construct, renovate, modernize, improve, or expand facilities or equipment in the U.S. to produce goods or services involved in foreign trade – Refinance existing debt with unreasonable terms & conditions (including any debt qualifying for refinancing under the standard 7(a) program) | $5 million | – All standard 7(a) requirements, plus – Prove that the loan will allow the business to expand or develop an export market OR demonstrate that the business has been adversely affected by import competition and that the ITL will improve its competitiveness | Terms – Up to 10 years for equipment, working capital, or inventory loans – Up to 25 years for real estate loans SBA International Trade Loan Fact Sheet |
| 7(a) Seasonal CAPLine | Finance seasonal increases in accounts receivable, inventory, & possibly labor (but NOT to maintain activity during the slow periods) | $5 million | – All standard 7(a) requirements, plus – Business has been operating for at least one year – Need to demonstrate a pattern of seasonal activity | Terms – Up to 10 years (but can be renewed at any time before maturity) SBA Overview of CAPLine Programs |
| 7(a) Contract CAPLine | Finance the cost of one or more specific contracts, subcontracts, or purchase orders | $5 million | – All standard 7(a) requirements, plus – Show a specific contract or subcontract which needs financing and in which significant performance has not already begun | Terms – Up to 10 years (but can be renewed at any time before maturity) SBA Contract CAPLine Program Info (Insider Info Lenders Use to Vet Your Application) |
| 7(a) Builders CAPLine | Direct expenses related to the construction and/or substantial renovation of a specific eligible project (residential or commercial building) | $5 million | – All standard 7(a) requirements, plus – Demonstrate a specific eligible project | Terms – Up to 5 years (but can be renewed at any time before maturity) SBA Overview of CAPLine Programs |
| 7(a) Working CAPLine | Allowed – Short term working capital Not Allowed – Paying deliquent taxes (e.g. state or sales taxes) – Purchasing fixed assets | $5 million | Same as standard 7(a) requirements | Terms – Up to 10 years (but can be renewed at any time before maturity) SBA Overview of CAPLine Programs |
| CDC/504 Loan | Allowed – Long-term fixed assets for expansion or modernization – Purchasing commercial real estate for owner occupation – Machinery / equipment – Refinancing large equipment – Refinancing owner-occupied commercial real estate – improving or modernizing existing facilities – improving or modernizing land, streets, utilities, parking lots, or landscaping (with limits) Not Allowed – Working capital or inventory – consolidating, repaying, or refinancing debt – speculation or investment in rental real estate | $5 million | – Be a for profit business – Engaged in U.S. business – Tangible net worth under $15 million – Average annual net income (after federal income taxes) of less than $5 million for prior 2 years | Terms – 10 years – 20 years – 25 years Only available through CDCs (Certified Development Companies). Here is the SBA’s official search engine to find CDCs near you. SBA 504 Loan Info Page |
| 504 Loan for eligible energy-efficient or manufacturing projects | Substantially the same as standard 504 Loan above | $5.5 million | – All standard 7(a) requirements, plus – Project must reduce building energy usage by 10% or offset energy usage by 10% with renewables | Substantially the same as standard 504 Loan above |
| Business Physical Disaster Loan | Allowed: Repair or replace any of the following past insurance coverage: – real property – machinery / equipment – fixtures – inventory – leasehold improvements Not Allowed – business expansion – machinery or equipment upgrades | $2 million | – Businesses and most private non-profits may be eligible – Business is located in a declared disaster area – Demonstrable physical damages beyond what insurance covers | Terms up to 30 years SBA Physical Disaster Loan Info Page |
| Disaster Mitigation Assistance Loan | Rebuild a stronger business with mitigation improvements to prevent or reduce damage from future disasters | 20% over Business Physical Disaster Loan Amount | Same as Business Physical Disaster Loan | This loan is an add-on to the Business Physical Disaster Loan with essentially the same terms. |
| Economic Injury Disaster Loan (EIDL) | Allowed – Working capital – Normal expenses (e.g. continuation of health care benefits, rent, utilities, and fixed debt payments) Not Allowed – covering lost income or profits – to be used in lieu of regular commercial debt – refinancing long term debt – business expansion | $2 million | – Businesses and most private non-profits may be eligible – Business is located in a declared disaster area – Demonstrable economic injury (i.e. show that the business is unable to meet its obligations and pay its ordinary and necessary operating expenses) | Terms up to 30 years SBA EIDL Info Page NOTE: The COVID-19 EIDL program is similar but notably different than the standard EIDL |
| Military Reservist Economic Injury Disaster Loan (MREIDL) | The same as the normal EIDL above | $2 million (limit may be raised by SBA if business is a substantial employer) | Business is unable to meet its ordinary and necessary operating expenses because an essential employee was called to active duty in their role as military reservist | Terms up to 30 years SBA Military Reservist Loan Info Page |
| 7(a) Community Advantage Loan (Pilot Program) | Substantially the same as the normal 7(a) uses | $250,000 | Similar to standard 7(a) requirements, but more flexible to serve mission-driven companies | Substantially the same as the standard 7(a) terms, but with different lenders usually who may be more lenient and focused on community-serving organizations. Program ends September 30, 2022. |
| Veterans Advantage Program | The Veterans Advantage Program is not a single type of loan but rather a loan program than can apply to most of the loans previously mentioned. | Same or higher than non-veteran version of the loan type | Business is at least 51% owned by one or more individuals who are: honorably discharged veterans, active duty military eligible for TAP, active reservists, active national guard members, or current spouse or widow of any of the above or of someone who died or was disabled in service | SBA Veterans Advantage Fact Sheet |