SBA Loans, Explained — and Shopped For You
The SBA doesn't lend money. It guarantees loans that banks and lenders make — which unlocks longer terms, lower down payments, and approvals that wouldn't happen conventionally. The catch: every SBA lender has its own credit box. We package your file once and place it with the lenders most likely to say yes.
How an SBA loan actually works
1. The government guarantees
The SBA backs a large share of the loan — typically 75–85% on 7(a) — so the lender's risk shrinks dramatically.
2. A lender approves & funds
Banks and SBA-approved lenders make the actual loan and decision. Each has its own appetite — which lender sees your file matters as much as the file itself.
3. You get bank-beating structure
Longer terms (up to 25 years on real estate), lower down payments, and uses conventional loans often won't touch — like partner buyouts and acquisitions.
The SBA programs, side by side
Program caps are set by the SBA; rates and final terms are set by the lender and vary by deal.
| Program | Max amount | Best for | Typical terms | Start here |
|---|---|---|---|---|
| SBA 7(a) | Up to $5 million | Working capital, business acquisitions & partner buyouts, refinancing, equipment | Up to 10 yrs (working capital) · up to 25 yrs (real estate) | Business Capital → |
| SBA 504 | Up to $5.5 million | Owner-occupied real estate & heavy equipment — long-term fixed rates, down payments often ~10% | 10, 20, or 25 years | Real Estate & Assets → |
| SBA Express | Up to $500,000 | Smaller, faster needs — SBA responds to the lender in as little as 36 hours | Term loan or revolving line | Business Capital → |
| SBA Microloan | Up to $50,000 | Startups and very small businesses building history | Up to 6 years | Business Capital → |
| SBA Line of Credit | Program-dependent | Seasonal or contract-driven working capital (CAPLines / 7(a) WCP) | Revolving | Business Capital → |
What you'll typically need
Typical guidelines across SBA lenders — the SBA sets eligibility; each lender sets its own credit box.
Capco Capital is a commercial finance broker operated by Capco Capital LLC. We are not a lender and are not affiliated with the U.S. Small Business Administration. Guidelines vary by lender and program and are not a commitment to lend.
SBA questions, answered straight
How do SBA loans actually work?
The SBA doesn't lend the money — banks and approved lenders do. The SBA guarantees a large portion of the loan (typically 75–85% on 7(a)), which reduces the lender's risk and lets them approve businesses and terms they otherwise couldn't. You repay the lender like any loan; the guarantee only matters if things go wrong.
What's the difference between SBA 7(a) and SBA 504?
7(a) is the versatile program — working capital, acquisitions and partner buyouts, refinancing, equipment, up to $5 million. 504 is purpose-built for fixed assets — owner-occupied real estate and heavy equipment — up to $5.5 million through a bank + Certified Development Company structure, with long-term fixed rates and down payments often around 10%.
Can an SBA loan fund a partner buyout or business acquisition?
Yes — that's one of 7(a)'s core uses. The loan finances the purchase of a partner's ownership interest or an entire business, repaid from the business's cash flow. A business valuation is typically part of underwriting.
What do I need to qualify for an SBA loan?
A for-profit U.S. business of eligible size, reasonable owner credit (most lenders look for the mid-600s and up), cash flow that supports the payment, and owners of 20%+ typically provide a personal guarantee. Collateral helps but a shortfall alone doesn't disqualify a 7(a) deal.
How long does SBA funding take?
Honest answer: SBA is the slower, cheaper option. Express can move in days-to-weeks; standard 7(a) commonly runs 30–90 days; 504 usually takes 60–90+ days because of the two-part structure. If your timeline is shorter, we often bridge with faster financing and refinance into SBA later.
Why go through a broker instead of straight to a bank?
Every SBA lender has its own credit box, industry appetite, and turn times — a bank can only offer you its own. We package one file and place it with the SBA lenders most likely to approve your specific deal, and if SBA isn't the best fit, the same file works for conventional options.
One file. Every SBA lender that fits.
Two minutes to see your options — no credit impact, no obligation. Or call (337) 344-9939.
