SBA Loan Calculator: Estimate Payments on 7(a), 504 Loans

Enter your loan amount, interest rate and repayment term to calculate monthly payments on a Small Business Administration loan.
Aug 29, 2022

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Government-backed SBA loans offer low interest rates and long repayment terms, which can make them a great way to fund your business. NerdWallet’s SBA loan calculator can help you estimate monthly bills and total payments on an SBA 7(a), Express or 504 loan to decide if one is a good fit.

The best small-business loan for you is typically the one with the most favorable rates and terms that you can qualify for — which depends on how long you’ve been in business, your credit score, your revenue and other factors.

SBA loan calculator

Understanding your SBA loan calculator results

This calculator includes some of the core elements of an SBA loan, including your monthly principal and interest. But it doesn’t include some fees that your lender may charge.

What’s included:

Monthly payment: This is the amount you’ll owe your lender each month. It includes payment toward your principal, interest and guarantee fee (if applicable).

Total payments: This is the total amount you will pay back over the life of the loan. It includes the amount you borrowed, plus interest and guarantee fee (if applicable).

Total interest paid: This is the total amount you will pay your lender in interest. Repaying your loan early can help you save on interest.

Guarantee fee: If an SBA 7(a) loan has a term of 12 months or longer, the lender is required to pay an upfront guarantee fee, which is a percentage of the loan amount that varies depending on the size of the loan. The lender can pass this guarantee fee onto the borrower,

Code of Federal Regulations. § 120.220 Fees that Lender pays SBA. Accessed Aug 25, 2022.
either adding it to your loan balance or as a separate charge after your loan disbursement. This SBA loan calculator adds the guarantee fee to the amount borrowed.

Down payment amount: SBA 504 loans require a down payment. Because you pay this amount up front, you don’t need to finance it, and it doesn’t count toward your loan total.

Amortization schedule: This represents how much of each monthly payment will go toward your principal and how much will be spent on interest. Over time, your monthly payment will remain the same, but your interest payments will get smaller and more of your payment will go toward your principal.

What’s not included:

This calculator does not include some loan costs. Your lender can charge service and packaging fees, filing and recording fees, and late payment fees. They can also seek approval from the SBA to charge additional fees if a loan will require an extraordinary amount of work to administer.

How SBA loan interest rates work

SBA loan rates for 7(a) loans are pegged to the daily prime rate, which is based on the Federal Reserve’s actions. The rate you will pay is based on the daily prime rate plus a lender spread. 7(a) loan interest rates can be either fixed or variable. This calculator assumes a fixed rate.

For SBA 504 loans, interest rates are based on the market rate for 5- and 10-year U.S. Treasury bonds.

U.S. Small Business Administration. 504 loans. Accessed Aug 25, 2022.
Rates are fixed for the life of the loan.

You and your lender will negotiate your interest rate, so you may need to work with an estimated interest rate to use the SBA loan calculator.

How SBA guarantee fees work

The SBA guarantees a percentage of SBA 7(a) loans, promising to reimburse lenders for that amount should the loan default. In exchange, the lender has to pay an upfront fee on the guaranteed percentage of the loan. They usually pass this SBA guarantee fee onto the borrower.

Lenders also have to pay the SBA an annual service fee, which is a small percentage of the outstanding balance of the loan, on loans greater than $350,000. This fee cannot be passed onto the borrower.

SBA loan types and lenders

SBA 7(a) loans

SBA 7(a) loans are the most common type of SBA loan. They can be used for working capital, business expansion, debt consolidation or buying real estate or equipment.

SBA 7(a) loans are issued by financial institutions, usually banks. Learn more about SBA lenders.

SBA Express loans

SBA Express loans are SBA 7(a) loans of up to $500,000 that can be approved within 36 hours. Export Express loans, which are exclusively for export businesses, can be approved within 24 hours.

SBA 504 loans

SBA 504 loans have very long terms — up to 25 years — and can be used to finance real estate or equipment purchases. They are funded by Certified Development Companies, or CDCs, and financial institutions. You’ll need to put at least 10% down.

How to qualify for an SBA loan

SBA loan requirements can vary depending on the lender you’re working with and which loan program you’re applying for.

All SBA loans require the following, though:

  • You must be a for-profit business.

  • You must have invested your own time and money, or another form of equity, into your business.

  • You have to explain what you plan to use the funds for and why you need the financing.

  • You must be a small business. The SBA’s definition of “small business” depends on your annual revenue or number of employees and varies depending on your industry.

    You can see the SBA’s business size definitions here.