How SBA rates are set: a negotiated rate under a federal ceiling
The maximum fixed rate is 12.0% to 15.0% [3]. The SBA does not set your rate. Your lender does, within limits. SBA maximums are pegged to the prime rate or an optional peg rate, and the loan can be fixed or variable [1]. The lender adds a spread on top of the base rate, and that spread cannot exceed the SBA's maximum for your loan size.
Under the current rulebook, a variable loan can also use an alternative base rate: the Secured Overnight Funding Rate (SOFR), the 5-year Treasury note rate or the 10-year Treasury note rate [5]. Ask which base your lender uses, because each moves differently.
On a variable loan, the rate can change no more often than monthly, and it moves by exactly as much as the base rate moves [2]. The spread written into your note cannot change for the life of the loan without your written agreement [5].
Today's base rates, from the Federal Reserve
The Federal Reserve's H.15 release of October 20, 2026 shows the bank prime loan rate at 7.00% every day from October 13 to October 19, 2026, and the 10-year Treasury constant maturity yield at 5.15% on October 19 [4].
| Rate | Latest value | Used for |
|---|---|---|
| Bank prime loan rate | 7.00% | 7(a) caps, fixed and variable |
| 10-year Treasury yield | 5.15% | 504 debenture pricing; also an alternative 7(a) base rate |
Prime is the rate posted by a majority of the 25 largest insured U.S.-chartered commercial banks [4]. When it moves, every cap in the table at the top of this page moves with it. Check the date on any rate you read, including ours.
What the maximum rate costs in dollars
A rate only means something next to a payment. Here is what four loan sizes cost over 10 years at today's maximum variable rate, which is the most a lender can charge at today's prime. Your rate can be lower.
| Loan | Maximum rate | Monthly payment | Total interest |
|---|---|---|---|
| $25,000 | 13.5% | $380.69 | $20,682.29 |
| $150,000 | 13.0% | $2,239.66 | $118,759.33 |
| $350,000 | 11.5% | $4,920.84 | $240,500.86 |
| $1,000,000 | 10.0% | $13,215.07 | $585,808.84 |
Bigger SBA loans carry lower caps, so the cost per dollar falls as the loan grows. A variable loan's payment can change when the base rate changes, while a fixed-rate loan's payment stays the same [6].
How to check an SBA quote against the cap in four steps
You do not need to trust anyone's word that a 7(a) quote is fair. You can test it against the federal ceiling with numbers that are public:
- Find the loan amount band. The cap depends on the total loan size, so a $200,000 loan sits in the $50,001 to $250,000 band [2].
- Find the base rate. Ask the lender which base it uses and its value on the first business day of the month your application went to the SBA [5]. For prime, the Federal Reserve's H.15 release lists it [4].
- Find the spread. Subtract the base rate from the quoted rate. On a variable $200,000 loan the spread can be no more than 6.0 percentage points [2].
- Compare. A variable quote of prime plus 6.25% on a $200,000 loan is above the cap and not allowed. Prime plus 4% is within it, and you can still negotiate lower.
Fixed quotes work the same way with the fixed spreads: 8, 7, 6 or 5 percentage points over prime depending on size [3]. A fixed maximum may only be used if the rate stays fixed for the entire term with no reset; otherwise the variable caps apply [5].
Rates on SBA lines of credit and export loans
SBA lines of credit follow the same ceiling. On the 7(a) Working Capital Pilot, the rate cannot exceed the base rate plus 6.5% at $50,000 or less, falling to the base rate plus 3.0% at $350,001 and up [1]. SBA Express, Export Express and international trade loans are also negotiated subject to the SBA maximum [1].
One program is different. On Export Working Capital Program loans, the lender and borrower negotiate the rate and there is no SBA maximum interest rate limit [1]. If you are offered one, compare it with other quotes rather than with the caps on this page.
SBA 504 and microloan rates
504 loans work differently. The SBA-backed part is funded by a debenture sold to investors, and the rate is pegged to an increment above the current market rate for 10-year U.S. Treasury issues [7]. That makes it a fixed rate for the life of the loan. NerdWallet puts typical 504 rates at about 5% to 7% [8].
504 fees total approximately 3% of the debt, and the SBA says they may be financed with the loan [7]. The bank that lends the other half of a 504 project sets its own rate on its piece.
SBA microloans, up to $50,000 through nonprofit intermediaries, typically run 8% to 13%, according to NerdWallet [8].
| Program | How the rate is set | Typical or maximum today |
|---|---|---|
| 7(a) variable | Base rate plus a capped spread [2] | 10.0% to 13.5% maximum |
| 7(a) fixed | Prime plus a capped spread [3] | 12.0% to 15.0% maximum |
| 504 | Above the 10-year Treasury [7] | About 5% to 7% typical [8] |
| Microloan | Negotiated with the intermediary | About 8% to 13% typical [8] |
Fees that sit on top of the rate
The rate is not the only cost. The lender pays the SBA an upfront guaranty fee on each 7(a) loan and may pass it on to you [1]. The SBA's maximum upfront fee is figured on the part of the loan the SBA backs, not the whole loan [5]:
| Loan size | Maximum upfront fee |
|---|---|
| $150,000 or less | 2% of the SBA-backed portion |
| $150,001 to $700,000 | 3% of the SBA-backed portion |
| $700,001 to $5,000,000 | 3.5% of the backed portion up to $1 million, plus 3.75% above $1 million |
| Term of 12 months or less, any size | 0.25% of the SBA-backed portion |
The SBA's own example: on a $100,000 loan with an 85% guaranty, the fee is 2% of $85,000, or $1,700 [5]. The SBA can set lower fees for a fiscal year by notice [5], so ask your lender for the current figure. The lender's annual service fee cannot be charged to you [1].
Prepayment fees on long loans
On a 7(a) loan of 15 years or more, paying off 25% or more of the balance early in the first 3 years costs 5% of the prepaid amount in year one, 3% in year two and 1% in year three [1].