What will my SBA loan cost?

How it works

Write L for the gross loan amount (the guaranteed and unguaranteed parts together, up to $5,000,000), r for the monthly rate (the yearly rate in percent ÷ 1200), and n for the months: the term in years × 12, rounded to the nearest whole month (a half month rounds up). There is no answer when n rounds to 0.

1. Payment: payment = L × r ÷ (1 − (1 + r)^−n). At 0% it is L ÷ n.
2. Guaranteed portion: G = 85% of L when L is $150,000 or less, else 75% of L.
3. Guaranty fee (fiscal year 2027), a percent of G:
   • with the relief box ticked and L of $700,000 or less: 0%;
   • otherwise, a maturity of 12 months or less (n ≤ 12): 0.25% of G;
   • otherwise, L of $150,000 or less: 2% of G;
   • otherwise, L of $700,000 or less: 3% of G;
   • otherwise: 3.5% of the first $1,000,000 of G plus 3.75% of the part of G over $1,000,000.
4. Fees: all fees = the guaranty fee + the other fees; loan minus fees = L − all fees. The guaranty fee as a share of the loan is 100 × fee ÷ L. There is no answer when the fees are the whole loan or more.
5. Schedule and totals: each month, interest = balance × r and the rest of the payment lowers the balance; the last payment pays what is left. Total interest = n × payment − L; total of payments = L + interest; cost of the loan = interest + all fees.
6. APR: find the monthly rate j at which the n payments, discounted at j, add up to L minus all fees: L − fees = payment × (1 − (1 + j)^−n) ÷ j. The APR is 12 × j (the actuarial method of Regulation Z, appendix J). With no fees the APR equals the rate.
7. Last payment: with a start date, the first payment is one month after it and the last is n months after it.

Assumptions

• The rate is fixed and the loan is repaid by equal monthly payments (variable-rate 7(a) loans change with the prime rate).
• The guaranty fee uses the fiscal year 2027 rates; the tiers go by the gross loan amount.
• Fees are paid at closing, in cash or out of the loan, and count as a cost in the APR.
• The lender’s annual service fee of 0.55% of the guaranteed balance is not included, because lenders may not pass it on to the borrower.
• Values are not rounded to the cent between months; only the display is rounded.
• The default rate is an example, not a live rate.

When the data is out of date

The fee table covers loans approved from October 1, 2026 to September 30, 2027. After that, the page keeps using these fees and says so above the result ("Uses SBA 7(a) fees for fiscal year 2027"). The SBA publishes each year’s fees before October 1; check them with your lender.

Worked examples by hand

$350,000 at 10.5% over 10 years. r = 0.105 ÷ 12 = 0.00875 and n = 120, so (1 + r)^−120 = 0.351540 and the payment is 350,000 × 0.00875 ÷ (1 − 0.351540) = $4,722.72. The loan is over $150,000, so the SBA guarantees 75%: $262,500. It is between $150,001 and $700,000, so the fee is 3% of that: $7,875, which is 2.25% of the loan. The interest is 120 × 4,722.725 − 350,000 = $216,726.99. The monthly rate at which 120 payments of $4,722.72 are worth $342,125 is 0.920947%, so the APR is 11.05%.

$2,000,000 at 9% over 25 years, with $5,000 of other fees. (1 + r)^−300 = 0.106288, so the payment is 2,000,000 × 0.0075 ÷ (1 − 0.106288) = $16,783.93. G = 75% × 2,000,000 = $1,500,000; the fee is 3.5% × 1,000,000 + 3.75% × 500,000 = 35,000 + 18,750 = $53,750, so all fees are $58,750. The APR, from 300 payments of $16,783.93 worth $1,941,250, is 9.37%.

$100,000 at 11% for 1 year. n = 12, a short-term loan. G = 85% × 100,000 = $85,000 and the fee is 0.25% of it: $212.50. (1 + r)^−12 = 0.896283, so the payment is 100,000 × 0.0091667 ÷ (1 − 0.896283) = $8,838.17 for 12 payments. The APR is 11.40%.

$600,000 at 10% over 10 years to a manufacturer. The loan is $700,000 or less and the relief box is ticked, so the fee is $0 and the APR is the rate, 10%. The payment is $7,929.04.