SBA 7(a) Loan Program

  • 7(a) loans are the most basic and often used loans of the SBA’s business loan programs.
  • 7(a) loans are only available on a guaranty basis. This means that they are provided by lenders who choose to structure their own loans in accordance with the SBA’s requirements and who apply and receive a guaranty from the SBA on a portion of the loan. The SBA does not fully guarantee 7(a) loans. The lender and SBA share the risk that a borrower will not able to repay the loan in full. The guarantee is against payment default. It does not cover imprudent decisions by the lender or misrepresentation by the borrower.

What can an SBA 7(a) loan be used for?

  • To buy an existing business
  • Start up capital for a new business
  • Working capital
  • To refinance existing debt
  • To purchase new or used equipment
  • To purchase real estate for business purposes
  • To finance accounts receivable

Ineligible Business

Businesses cannot be engaged in illegal activities, loan packaging, speculation, multi-sales distribution, gambling, investment or lending, or have an owner on parole.

  • Real Estate Investment
  • Lending Activities: Bank, Finance and Leasing companies, Insurance companies, etc.
  • Pyramid Sales Plans
  • Illegal Activities
  • Gambling Activities
  • Charitable, Religious, or Other Non-Profit organizations
  • Other Speculative Activities

SBA 7(a) Loan Amount

The 7(a) Loan Program has a maximum loan amount of $5 million dollars. If a business receives an SBA guaranteed loan for $2.0 million, the maximum guaranty to the lender will be for $1.5 million or 75%.


  • Real Estate and Equipment: Maximum 25 years
  • Working Capital: Generally 10 years