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SBA Loans

Accessible Funding with Great Rates

If you’ve never heard of the SBA or are asking yourself, “What is an SBA loan?” we’re here to help. SBA loans are partially guaranteed by the Small Business Administration (SBA). As a result, lenders face less risk in the case of default. And less risk for lenders means more access to affordable long-term financing for small business owners.

  • Opens access to large sums of capital
  • Rates and terms comparable to bank loans
  • Funds can be used for almost any business purpose
All Loan Types

Loan Amount

Up to $5M

Estimated Repayment Terms

5 - 25 Years

Interest Rate

Starting @ 7.25%

Speed of Funding

As fast as 7 days

People Calculating Financial Decisions

SBA Loans: Your Solution to Affordable Long-Term Financing

There’s no doubt about it: obtaining long-term small business financing is challenging. In fact, according to a recent NSBA survey, financing remains elusive for 1 out of 4 small business owners — particularly at large banks, where the number of firms relying on bank-backed loans has hovered at just 15%.

So what options do you have when you aim to expand operations and grow, but you don’t have the capital on hand to do it? Enter SBA loans. Through a suite of government-backed products that reduce risk for lenders, small business owners can access affordable long-term financing.

Loan Use Cases

How Do SBA Loans Work?

SBA loans work by lowering the risks lenders face when working with small business owners. SBA loans are partially guaranteed by the Small Business Administration and issued exclusively to small business owners by participating lenders according to SBA-defined guidelines.

Should a borrower default on their loan, the SBA reimburses the lender up to 85% of the loan amount.

As a result, participating creditors consider a larger pool of applicants and offer competitive terms. All this translates into greater access to long-term financing, lower interest rates, longer repayment periods and affordable monthly payments.

Types of SBA Loans

There are several types of SBA loans available. The right type of SBA financing for you will depend on your needs.

SBA 7(a) Loan Program

When most small business owners think of an “SBA loan,” the SBA 7(a) loan program is what comes to mind. Its popularity is due to its flexibility, as these types of SBA loans have few limitations.

Funds can be used for almost any business purpose, whether you require working capital to sustain your operations, a loan to refinance existing debt or cash to invest in the expansion of your business.

There are different loan programs under the SBA 7(a) umbrella. Here are 3 of the most popular:

Standard 7(a) Loans

You can borrow up to $5 million through the standard SBA 7(a) loan program. Interest rates are negotiable, and loans typically reach maturity in 7 years or 25 years depending on how the money is used.

The SBA guarantees 75% for loans greater than $150,000 or 85% for loans up to $150,000. SBA loan interest rates are most often variable based on the current Prime rate plus an additional lender rate.

The amount of time it takes to finalize a standard SBA loan (from application to funding) varies by lender, but you can expect the process to take a minimum of 60 to 90 days.

Key Considerations:
  • Loan Amount: Up to $5 million
  • Interest Rate: Prime (+ a maximum of 4.75% in lender interest)
  • Term: 7-25 years  
  • Time-to-Funding: 60-90 days 

SBA Express Loans

If you’re looking for quick SBA loan financing, you might be disappointed to find that the SBA funding process is notoriously lengthy. However, SBA Express financing short-cuts this process and is the best choice for a fast SBA loan. When you submit an SBA Express loan application, you’ll receive a decision from your lender within 36 hours. And funds are deposited within your business bank account in as little as 30 days. 

The trade-off for this speed is less borrowing potential and higher interest rates. Through the SBA Express program, you can acquire up to $350,000 over a 5- to 10-year term. The SBA will back up to 50% of this amount and lenders can tack on an additional 4.5% to 6.5% in interest depending on the amount borrowed. 

Key Considerations:
  • Loan Amount: Up to $350k
  • Interest Rate: Prime (+ a maximum of 6.5% in lender interest)
  • Term: 5-10 years
  • Time-to-Funding: 30-60 days

SBA Lines of Credit (CAPLines)

CAPLines are ideal for business owners with short-term and cyclical working capital needs. Credit lines go up to $5 million and are available with a maximum repayment term of 10 years. 

There are 5 distinct lines of credit offered under this program. They are the:

  • Seasonal CAPLine
  • Contract CAPLine
  • Builders CAPLine
  • Asset CAPLine
  • Working Capital CAPLine

Funds from each program are expense-specific, meaning they can only be used to fund projects that fall within the credit line’s classification. For example, funds from a Seasonal CAPLine cannot be used to finance storefront renovations.

Key Considerations:
  • Loan Amount: Up to $5 million
  • Interest Rate: Prime (+ a maximum of 4.75% in lender interest)
  • Term: Not to exceed 10 years (5 years for Builders CAPLine)
  • Time-to-Funding: 60-90 days

Paycheck Protection Program Loans

As part of the CARES Act, the government unveiled the Paycheck Protection Program (PPP). The Treasury Department has allocated $349 billion for guaranteeing special SBA 7(a) loans designed to cover qualifying payroll expenses for businesses in operation before February 15, 2020.

Portions of the loan can also be used to pay for state and local taxes, mortgage interest, rent and utilities. Companies can borrow up to 2.5 times their average monthly payroll costs for the past year, up to $10 million.

If a business is able to maintain specific staff and salary levels, the loan may be completely or partially forgiven. The program will be available until June 30, 2020.

Key Considerations:
  • Loan Amount: Up to $10 million 
  • Interest Rate: Fixed interest rate of 1%
  • Term: 2 years 
  • Application Deadline: June 30, 2020 

SBA CDC/504 Loans

The second most popular type of SBA loan is the CDC/504 program. You should consider this program if you’re looking to acquire or improve a major fixed asset, such as land, real estate or equipment.

SBA CDC/504 programs are unique in the way they’re structured. A lender partners with a certified development company (CDC) — a specialized non-profit corporation — to finance a loan request.  In this agreement, a lender funds 50% of the total project cost and the CDC funds 40%, with the borrower responsible for the remaining 10% as a down payment. The SBA backs only the CDC portion of the loan.

There is no maximum loan amount for this program, but the SBA does set a limit for what the CDC can contribute, and thus, what it’s willing to guarantee. That maximum is $5 million.

The interest rates on the lender-portion of the loan is negotiated between the lender and the borrower, and is subject to an interest rate cap. The rates on the CDC portion are based on the current 5- or 10-year Treasury rate.

Key Considerations:
  • Loan Amount: Unlimited
  • Interest Rate: Negotiable (third-party lender)/ 5- or 10-year Treasury + 0.38% – 0.48% (CDC) 
  • Term: 10 or 20 years
  • Time-to-Funding: 60-180 days

SBA Micro Loans

If you’re an entrepreneur — particularly a solopreneur — and require only a few thousand dollars to finance a project, consider an SBA micro loan.

What is a micro loan? In short, SBA micro loans are issued by non-profit, community-based organizations with experience in lending. You can borrow up to $50,000, but the average micro loan issued is $13,000.

Though SBA-backed micro loans can be used to fund a variety of projects, they cannot be used to acquire real estate or to refinance existing debt.

Interest rates vary, but in general, fall with the 8% to 13% range.

Key Considerations:
  • Loan Amount: Up to $50,000
  • Interest Rate: 8% – 13%
  • Term: 6 years
  • Time-to-Funding: 30-60 days

What Are SBA Loan Requirements?

SBA loan requirements call for your business to be “financially healthy.” What characteristics embody this classification?

For starters, a good credit score. Business owners need a personal credit score of 650 or better to qualify for an SBA loan.

Second, an established business history. Though some SBA loans (like the micro loan) are suitable for startups, most lenders require at least 2 years of business history.

Additionally, an applicant must demonstrate a history of positive cash flow, with enough capital on hand to sustain operations and cover monthly SBA loan payments and other debt obligations.

SBA loan requirements also stipulate that your track record must be free of recent bankruptcies or foreclosures, as well as open tax liens.

Do You Qualify?
Based on previously approved borrowers, you’re likely to qualify if:

  • You’ve been in business 2 or more years.
  • Your annual revenue is $50k or higher.
  • Your credit score is 650 or better.

How to Apply for Financing

How to Apply for an SBA Loan

Through our simple and secure application, small business owners, like you, are paired with some of the best lenders for SBA loans across the country whose requirements match your business’s qualification profile.

The process is streamlined, uncomplicated — and most importantly — fast.

What Will an SBA Loan Cost?

How much will an SBA loan cost you? The good news is, you’d be hard-pressed to find a program with more favorable terms. Aside from a conventional bank loan, SBA loan interest rates tend to be the lowest of all financing options available to small business owners.

The amount you pay will depend on the program, the amount borrowed and the term.

For example, Fast Capital 360’s partners all charge a variable interest rate starting at Prime plus 3.75% for an SBA Express loan up to $49,000. For loans over $150,000, interest rates are higher — Prime plus 2.75%.

Be aware that the SBA charges a guarantee fee of 1.7% for loans up to $150,000, and 2.25% for loans greater than $150,000. These fees are passed on to you, the borrower. Some partners also charge an origination fee or loan packaging fee.

Cost Example

Just how affordable can an SBA loan be? Let’s take a look at an example to find out.

Amount Borrowed:$150,000
Interest Rate:8.25%
Term:10 Years
Monthly Payment:$1,839.79
Total Repayment:$220,774.73
Cost of Loan:$70,774.73


Loan Use Cases

What Will You Use Your SBA Loan For?

Use your SBA loan for covering everyday business expenses, refinancing debt or growing your business. SBA loans have few restrictions, so loan proceeds can be used in a multitude of ways.

Here are just a few examples of how you can run and grow your business with an SBA loan.

Payroll Expenses

The coronavirus pandemic has upset businesses nationwide. Proceeds from the Paycheck Protection Program can be used to cover payroll costs, including salary, wages, tips, commissions, paid leave benefits, employer-paid health insurance premiums and state and local payroll taxes.

Working Capital

The cardinal rule of good business operations is to have enough working capital in the bank at all times to cover day-to-day costs and other financial expenses (foreseen or otherwise). 

A long-term, low-interest SBA loan can provide a reserve of working capital deep enough to keep your company running and growing.

Debt Refinancing

If you’re currently paying off a number of high-interest loans, you can save big with debt refinancing. Replacing this expensive debt with a low-interest, long-term SBA loan can make a big difference for your bottom line. 

Your bank account and your cash flow will thank you.

Business Expansion

If you aim to expand your business, there are several ways to do it — from introducing a new product line to opening a location. Whatever the method, you’ll need capital to execute on your vision. The best SBA loans can provide the cash you need without burdening your business with expensive debt.

See how one business grew with SBA financing. Symbio Physiotherapy Success Story