The costs you will have for your loan depend on the details laid out by your lender. Besides the loan amount, you will see the following additional costs:
- Interest Rate: Negotiated between borrower and lender, but SBA loans cannot exceed the maximum interest rate. This depends on whether your loan is a fixed rate or variable rate.
- Guaranty Fee: You will also have to pay a guaranty fee based on the amount guaranteed by the SBA. For instance, if you borrow $150,000 or less, your fee is 2% of the SBA-guaranteed amount (usually 75%-80% of the total loan).
According to the SBA’s website: “Lenders can’t charge a separate loan origination fee on an SBA guaranteed loan. Lenders can charge ‘packaging fees,’ but the fees must be reasonable and customary for the services actually performed and must be consistent with those fees charged on the lender’s similarly-sized non-SBA guaranteed commercial loans.”
Any fees charged must be documented on SBA Form 1597(a) and signed by all parties at the time of loan disbursement.
Here’s a list of other SBA 7(a) loan fees you can expect:
- SBA Loan Packaging Fee: Loan providers typically charge an SBA loan packaging fee to organize your loan documents and improve your approval chances. This fee can be anywhere from $2,000 to $4,000.
- SBA Loan Broker Fee: If you used a broker to facilitate the loan, you might need to pay a broker fee. The SBA doesn’t allow “broker fees,” but these fees often get bundled into the packaging fees. Typical broker fees range from 2% to 5% of your total loan amount.
- SBA Loan Service Fee: Your SBA loan lender may charge an ongoing service fee to manage your loan. These fees help cover the costs of billing, processing, and maintaining records. Loan service fees typically range from 0.25% to 0.75% of the remaining balance on your loan at each billing cycle.
- SBA Loan Closing Costs: SBA loan closing costs are basically a miscellaneous group of fees lumped together. These include appraisal fees, business valuations, title fees, attorney costs, and more.
- SBA Loan Late-Payment Fee: You could be charged anywhere from 5% of the late payment to $100 (whichever is greater) for making a late payment.
- SBA Loan Prepayment Fee: For long-term SBA loans, you’ll typically face prepayment penalties if you pay off your loan early.
Check with your lender to determine the precise amount for fees, interest rates, and other costs on your loan.
