SBA 7(a) Loans in Tacoma and the South Sound

         What is the SBA 7(a) Program?

The 7(a) Loan Program is SBA’s primary program for helping small businesses with financing guaranteed for a variety of general business purposes.


·         Equipment purchases (machinery, business vehicles)

·         Permanent working capital

·         Inventory

·         Business expansion

·         Business purchase/acquisition (100% change in ownership)

·         Real estate purchase

·         Land acquisition and real estate construction

·         Real estate improvements

·         Refinance of existing business debt

·         Startup costs (case-by-case basis)



·         Minimum- $25,000

·         Maximum – $5 Million



·         Inventory or working capital- Typically structured at 7 years but not to exceed a maximum of 10 years

·         Equipment, fixtures, or furniture- Typically structured at 7 years but not to exceed a maximum of 10 years, it may not exceed the economic useful life.

·         Real Estate, including acquisition, rehabilitation, renovation, or construction- Up to 25 years plus any interest period to reasonably complete the construction or improvements

·         7(a) Refinancing- Must coincide with the remaining useful life of the assets being refinanced or use of proceeds chart


·     Variable Rates – based on Prime Rate based on dollar amount of loan and term

·     Fully-Amortized over life of loan (No Balloon)

·     Pre-Payment Penalty- Under $350,000- None, Over $350,000- 5,3,1%

·     SBA Guaranty Fee- $25,000-$150,000- 2% $150,001 to $700,000- 3%, $700,001- $5Mill- 3.5% (SBA changes SBA fees from time to time)

·     Lender may charge up to $2500 packaging fee.



·            Must be for profit and meet size standards

·            Good Character and credit management

·            Must be an eligible type of business



·            Long term financing

·            Improved Cash flow

·            Fixed Maturity

·            No balloons

·            No prepayment penalty under 15 years and $350,000




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