The short answer: SBA 7(a) guarantee fees for fiscal year 2026 (loans approved October 1, 2025 – September 30, 2026) run from 0.25% of the guaranteed portion for short-term loans to 2–3.75% for standard longer-term loans, depending on loan size. On a $350,000 loan, that’s a $7,875 upfront fee. The fee is technically the lender’s obligation but is routinely passed to you — and it can be financed into the loan. Below: the full FY 2026 schedule, worked examples, and the other fees that make up the true cost.
Fee schedules change every fiscal year. Date-stamp everything you read about SBA fees — including this page. If you’re reading this after September 2026, confirm the FY 2027 schedule with your lender or at sba.gov before budgeting.
The FY 2026 guarantee fee schedule
The guarantee fee applies to the SBA-guaranteed portion of the loan, not the full loan amount. The SBA guarantees 85% of loans up to $150,000 and 75% of larger loans (up to a $3.75 million maximum guarantee).
Loans with maturity of 12 months or less — 0.25% of the guaranteed portion, all loan sizes.
Loans with maturity over 12 months:
| Loan amount | SBA guarantee | Upfront fee (FY 2026) |
|---|---|---|
| $150,000 or less | 85% | 2% of guaranteed portion |
| $150,001 – $700,000 | 75% | 3% of guaranteed portion |
| $700,001 – $5,000,000 | 75% | 3.5% of guaranteed portion up to $1,000,000, plus 3.75% of the portion over $1,000,000 |
Special cases: SBA Express loans to veteran-owned businesses carry a 0% fee. The Export Working Capital Program has its own maturity-based schedule (0.25%–0.80%). Loans approved within 90 days of each other for the same borrower may be combined for fee-tier purposes — SBA prohibits splitting loans to dodge a higher fee tier.
Worked examples (FY 2026)
$100,000 loan, 10-year term. Guaranteed portion: $100,000 × 85% = $85,000. Fee: $85,000 × 2% = $1,700.
$350,000 loan, 10-year term. Guaranteed portion: $350,000 × 75% = $262,500. Fee: $262,500 × 3% = $7,875.
$2,000,000 loan, 25-year term. Guaranteed portion: $2,000,000 × 75% = $1,500,000. Fee: ($1,000,000 × 3.5%) + ($500,000 × 3.75%) = $35,000 + $18,750 = $53,750.
The true cost: fee plus interest, worked
Take the $350,000 loan at an illustrative 9.75% (say prime plus a 3-point spread — SBA caps the spread by loan size) over 10 years:
- Monthly payment on $350,000: $4,576.96; total paid: $549,235.02; interest: $199,235.02.
- Add the $7,875 guarantee fee (financed into the loan, it becomes $357,875 financed at $4,679.94/month, $561,592.81 total).
- The guarantee fee is about 4% of the total cost of capital — real money, but dwarfed by a decade of interest. The 7(a)’s cost advantage over alternatives comes from the rate and term, not from the fee being small.
Packaging fees and the other charges
- Packaging fees. Lenders (or third-party packagers) may charge a packaging fee for assembling your application. SBA caps these — ask the lender for the exact figure and the cap citation in writing, and know it can typically be financed into the loan rather than paid in cash at closing.
- What lenders may NOT charge. SBA rules prohibit lenders from charging origination points, “bonus” fees for approving the loan, renewal fees, or their own prepayment penalty. If you see any of these on a 7(a) term sheet, flag it — see Business Loan Agreement Red Flags.
- The one prepayment charge that exists. Borrowers with a term longer than 15 years who prepay within the first three years owe an SBA prepayment subsidy recoupment fee. It’s the only prepayment charge in the program.
- Interest rate structure. The rate is negotiated with the lender, typically quoted as prime plus a spread, with SBA capping the spread by loan size (the caps shrink as loans get bigger). The rate — not the fee — is the dominant cost driver on any multi-year 7(a).
The 7(a) vs. MCA cost contrast
The same $350,000 need funded by an MCA at a 1.35 factor would cost $122,500 in factor charges alone, repaid in months. The 7(a)’s $7,875 guarantee fee plus a decade of interest is dramatically cheaper in total dollars — at the price of a slower, stricter underwriting process. That’s the fundamental trade in small-business finance: speed and ease cost money; patience and paperwork save it. Run any non-SBA offer through the Business Funding Cost Analyzer and compare it against the 7(a) terms your lender quotes.
Timeline and underwriting: what the low price costs you
The 7(a)’s price advantage is real, and so is its process. Typical expectations (vary by lender):
- Timeline: 30–90 days from complete application to funding. Express loans move faster; complex deals (acquisitions, commercial real estate) move slower.
- Paperwork: 2–3 years of business and personal tax returns, financial statements, a business plan or use-of-funds narrative, and personal financial statements from owners with 20%+ stakes.
- Collateral: SBA generally requires available business assets as collateral; for loans above certain thresholds, personal real estate may be required as well. “Inadequate collateral” alone isn’t supposed to kill an application if cash flow is strong — but in practice, thin collateral means a harder process.
- Personal guarantee: required from every 20%+ owner. No exceptions of note.
If you need money in two weeks, the 7(a) is not your product — that’s precisely the gap MCAs and online term loans fill, at their prices. The honest use of the 7(a) is planned borrowing: expansion, equipment, acquisition, refinancing expensive debt. Start the application before you need the money.
SBA Express: the faster, smaller sibling
SBA Express loans (up to $500,000) use the same 7(a) umbrella with a streamlined process — lenders underwrite to their own standards with a 50% SBA guarantee instead of 75–85%. Faster, but typically at higher rates than standard 7(a), and veteran-owned businesses pay a 0% guarantee fee on Express loans. It’s the middle lane between a standard 7(a) and an online lender.
Who the 7(a) fits — and who it doesn’t
Fits: established businesses (typically 2+ years) with documented cash flow, borrowing for a defined purpose, who can wait 1–3 months. The classic cases: buying equipment, acquiring a competitor, refinancing high-cost debt, funding an expansion with a clear ROI.
Doesn’t fit: true startups with no revenue history (look at SBA Microloans up to $50,000 or community lenders instead), businesses needing cash this week, or borrowers who can’t document their finances. And if your use case is covering operating losses rather than funding growth, no loan structure fixes that — borrowed money just schedules the reckoning.
Got a non-SBA offer on the table? Run it through the Business Funding Cost Analyzer before you sign — then compare its equivalent APR against the 7(a) terms your lender quoted.
All fee figures are the FY 2026 schedule (approvals Oct 1, 2025 – Sep 30, 2026), sourced from the SBA’s FY 2026 fee guidance as summarized by lender-compliance reporting. Packaging-fee caps and spread caps should be confirmed with your lender in writing; program details change annually.