The questions are normal.The jargon is optional.

An SBA loan is generally made by a participating lender, not directly by the SBA. The SBA sets program rules and guarantees part of an eligible loan, which can reduce lender risk and help qualified small businesses access financing.

Usually, no. Participating banks and other approved lenders make 7(a) loans, while 504 projects involve a Certified Development Company and a third-party lender. SBA generally makes direct business loans only in declared-disaster programs.

7(a) is SBA’s flexible primary business-loan program and can support eligible acquisitions, working capital, equipment, real estate, refinancing, and mixed uses. The 504 program focuses on eligible major fixed assets such as owner-used real estate and long-life equipment, and it cannot be used for working capital or inventory.

The maximum 7(a) loan amount is $5 million. SBA’s 504 page lists a maximum loan amount of $5.5 million. Effective July 4, 2026, qualified borrowers may coordinate 7(a) and 504 financing up to a $10 million cumulative limit, but structure and eligibility still require lender and CDC review.

Yes. A complete or partial change of ownership is an eligible 7(a) use of proceeds. The lender will still evaluate the purchase price, cash flow, buyer experience, equity, seller financing, valuation, and the complete sources and uses of funds.

Potentially. A startup must still show an eligible business purpose, qualified management, a credible plan, reasonable projections, adequate borrower support, and a believable path to repayment. Requirements and risk tolerance vary by lender.

In general, the business must operate for profit, do business in the United States or its territories, meet applicable SBA size standards, have a sound business purpose, be creditworthy, and demonstrate repayment ability. Program- and lender-specific requirements also apply.

SBA does not publish one universal borrower credit-score cutoff for every 7(a) or 504 request. Lenders may consider personal and business credit, cash flow, equity, collateral, management, and the complete risk profile. Ask a lender for its current credit policy instead of relying on a single internet number.

There is no safe universal answer for every SBA deal. The required borrower contribution depends on the program, use of funds, project risk, lender policy, and the source of the cash. Startups, acquisitions, special-purpose properties, and new ownership can receive different treatment.

Sometimes a seller note can support a transaction structure, but its eligible treatment depends on current SBA rules and lender-approved terms, including whether standby is required. Do not assume a seller note replaces buyer cash until the lender confirms it in writing.

Collateral requirements depend on the loan size, available business and personal assets, program rules, and lender policy. A lack of enough collateral is not always the same as an automatic decline, but the lender will still document the available collateral and overall repayment risk.

Personal guarantees commonly apply to owners and guarantors under SBA and lender requirements. The exact parties, ownership thresholds, collateral documents, and guaranty terms should be confirmed with the lender for the specific transaction.

Repayment ability is central. Lenders may also evaluate credit, equity, collateral, management, and industry or project risk. Strong collateral does not repair a business that cannot reasonably support the debt payment.

A 7(a) rate is negotiated between the borrower and lender but is subject to SBA maximums tied to an allowed base rate. It may be fixed or variable. A 504 debenture rate is tied to the market for U.S. Treasury issues. Your actual pricing depends on the program, loan size, lender, structure, and market conditions.

For most 7(a) uses, maturity is generally 10 years or less unless real estate or qualifying long-life equipment supports a longer term; the program maximum can reach 25 years. SBA lists 10-, 20-, and 25-year maturity terms for 504 loans.

The full budget may include an SBA guaranty fee where applicable, lender fees, appraisal or valuation, environmental work, legal and accounting costs, title or recording costs, and other third-party expenses. Ask for a written estimate that separates financed costs from cash due at closing.

There is no single guaranteed timeline. Readiness, lender capacity, project complexity, valuation, environmental or title work, documentation, and borrower responsiveness can all change the schedule. A clean package can reduce avoidable delays, but it cannot remove underwriting or third-party review.

Prepayment treatment depends on the program, maturity, loan structure, and timing. Do not rely on a verbal summary—ask the lender or CDC to identify every prepayment provision in the proposed note and closing documents.

No. Compare the payment, amortization, maturity, variable-rate exposure, fees, collateral, guarantees, cash required, reserves, covenants, prepayment terms, and closing certainty. A slightly lower rate can be outweighed by a shorter amortization or materially higher cash requirement.

Expect information about the borrower and owners, the loan request, use of funds, existing debt, business financial performance, projections, tax returns, ownership, management, and the specific project. Acquisitions and real-estate deals add transaction documents and third-party reports.

A lender conversation before signing can reveal whether the price, cash requirement, working-capital plan, deposit, financing contingency, and closing deadline are realistic. Have qualified legal counsel review the contract; an educational financing review is not legal advice.

No. SBA states that 504 proceeds cannot be used for working capital or inventory. A project that needs both fixed assets and operating capital may require a different or coordinated financing structure.

Potentially. 7(a) can support eligible refinancing, while 504 refinancing is limited to qualified debt and program requirements. The lender must review the original use of proceeds, current terms, payment history, collateral, and the benefit of the refinance.

First identify the actual reason: repayment coverage, liquidity, credit, collateral, eligibility, valuation, structure, documentation, or lender fit. Sending the same package everywhere can multiply confusion. A focused second look can separate a fixable structure problem from a true eligibility or credit issue.

No. The planning tools and first-look forms are educational. They do not submit a formal loan application, make an approval decision, or pull your credit. A lender will explain and obtain any authorization required later in its own process.

Andrew does not charge borrowers for the educational guidance or planning tools on this site. If financing closes with a lender Andrew introduces, that lender may pay Andrew a referral fee. Compensation is disclosed when required, and you are free to compare lenders and offers.