A Look at SBA Fee Changes for Small Business Owners

A Look at SBA Fee Changes for Small Business Owners

With the recent updates to the Standard Operating Procedure (SOP) 50 10 7.1, several fee structures have shifted from the previous SOP 50 10 6. So, what changes should small business owners be aware of?

Upward Adjustments:

• Guarantee Fee: This fee, based on a percentage of the guaranteed loan amount, has seen a slight increase across most loan sizes. For instance, loans between $150,000 and $500,000 now incur a 2.75% fee, up from 2.25%. For loans exceeding $2 million, the new SOP introduces a 3.50% fee for the guaranteed portion exceeding $1 million, compared to the old SOP which capped it at 3.25%.

• Collateral Registry Fee: This fee, applicable to loans over $150,000 with specific types of collateral, has doubled from 0.125% to 0.25%.

• Variable Rate Loan Spread: The spread for variable rate SBA loans increased from 2.75% to 3% in the new SOP.

Downward Adjustments:

• Servicing Fee: This annual fee for servicing the guaranteed portion of a loan has decreased for certain loan sizes. Loans below $1 million now have a 0.25% servicing fee, down from 0.50%.

• Packaging Fee: The fee for packaging SBA loans for secondary market sale has been waived for loans under $10 million, providing cost savings for smaller businesses.

Some fees remained unchanged for consistent planning:

• Line of Credit Annual Fee: This fee for SBA lines of credit continues at 0.50% of the committed line amount.

• Disaster Loan Processing Fee: This fee remains at 3% of the loan amount for approved disaster loans.

Understanding these fee changes can help you better navigate your financing options and plan effectively for your small business's future.