Maximum Interest Rates for SBA 7(a) Loans
Maximum Interest Rates for SBA 7(a) Loans
Understanding the maximum interest rates for SBA 7(a) loans can help you make informed borrowing decisions for your business. Here's a breakdown of the current rates based on loan amounts:
SBA 7(a) Variable Loan Rate Maximums
The interest rates for 7(a) loans vary according to the loan amount:
$50,000 or less: Maximum spread of 6.5%, leading to a max rate of 15.00%.
$50,001 to $250,000: Maximum spread of 6%, with a current max rate of 14.50%.
$250,001 to $350,000: Maximum spread of 4.5%, resulting in a max rate of 13.00%.
Over $350,000: Maximum spread of 3%, giving a max rate of 11.5%.
These rates are effective as of October 2023, calculated with the current prime rate of 8.50%. Remember, these are maximum rates; actual rates may be lower.
Maximum Interest Rates for SBA 7(a) Small Loans and SBA Express Loans
For 7(a) Small and SBA Express loans, the maximum rates depend on the loan amount and whether the interest rate is fixed or variable:
Loans $50,000 or less: Cannot exceed the Prime or SBA Optional Peg Rate + 6.5%.
Loans $50,001 up to $250,000: Highest permissible interest rate is Prime or SBA Optional Peg Rate + 6.0%.
Loans $250,001 up to $350,000: Maximum allowable interest rate is Prime or SBA Optional Peg Rate + 4.5%.
Loans $350,001 up to $500,000: Interest rate cannot exceed Prime or SBA Optional Peg Rate + 3.0%.
These interest rates are structured to make borrowing accessible for small businesses while keeping costs reasonable. Keep in mind, these maximum rates can vary based on your creditworthiness, loan term, and overall risk profile.
Maximum Interest Rates for 7(a) CAPLines
For 7(a) CAPLines, the interest rates are also determined by the loan amount and whether the interest rate is fixed or variable:
Loans $50,000 or less: Maximum rate cannot exceed the published maximum allowable fixed rate or, if variable, Prime or SBA Optional Peg Rate + 6.5%.
Loans $50,001 up to $250,000: Cannot exceed the published maximum allowable fixed rate or, if variable, Prime or SBA Optional Peg Rate + 6.0%.
Loans $250,001 up to $350,000: Highest permissible rate is the published maximum allowable fixed rate or, if variable, Prime or SBA Optional Peg Rate + 4.5%.
Loans $350,001 and greater: Interest rate cannot exceed the published maximum allowable fixed rate or, if variable, Prime or SBA Optional Peg Rate + 3.0%.
Again, these are maximum rates, and actual rates may vary based on different factors, including your creditworthiness and the specifics of your loan. By understanding these rates, you can better navigate your borrowing options and choose the best financing solution for your small business.