SBA To Double To $10 Million Maximum Loans For Some Small Businesses
Key takeaways
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- But the new rule treats those caps as separate and provides that businesses that have already tapped $5 million in 7(a) loans can also get another $5 million in guarantees on 504 borrowings.
- Traditionally, only a small minority of SBA guarantee users take out 504 loans.
Learn more.This voice experience is generated by AI. Learn more.The SBA 7(a) loan guarantee limit remains $5 million, but small businesses can borrow another $5 million through a second program.Getty. The first year and a half of the second Trump Administration has been a mixed bag for small business owners. Tax cuts and an assault on federal regulation have pleased many, even as tariffs, immigration restrictions and now spiking fuel prices and rising interest rates have kept the small business optimism index below historic averages.
This week they had a clear win, as the Small Business Administration announced a new rule that will roughly double the combined guaranteed loan limit for certain capital intensive borrowers to $10 million, effective July 4th. “Anything that can expand the program’s availability to…small businesses is a win-win,” said Bob Coleman, author of the weekly Coleman Report on the SBA and its lending practices. “There’s no downside and there’s a lot of positives.”
The SBA guarantees two main types of loans: 7(a) loans are typically used for just about anything small businesses need and less flexible 504 loans are designated for “major fixed assets.” Congress has set a $5 million loan cap for 7(a) and a $5.5 million cap on the SBA-backed portion of 504 loans. But the new rule treats those caps as separate and provides that businesses that have already tapped $5 million in 7(a) loans can also get another $5 million in guarantees on 504 borrowings.