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Business Advantage

Small Business Administration Financing (SBA Loans)

The Small Business Administration (SBA) is a federal agency that helps established businesses grow and new businesses get started.

SBA loan types

SBA loans may help your business qualify for financing more easily and receive more flexible terms.That means you can preserve working capital for other expenses.

Are you eligible for an SBA loan?

 SBA 504SBA 7(a)SBA Express
Use it for
  • Purchase equipment or real estate (no refinancing)
  • Construction and renovation
  • Purchase or expand a business
  • Purchase equipment or inventory
  • Working capital
  • Refinance debt
  • Working capital
  • Purchase equipment
  • Purchase vehicles or inventory
  • Longer maturity than conventional loan
  • Lower down payments on fixed assets
  • Easier qualification than a conventional loan
  • Longer maturity than conventional loan
  • Lower down payments on fixed assets
  • Easier qualification than a conventional loan
  • Longer maturity than some conventional loans
  • Easier qualification than a conventional loan

$350,000 minimum, no maximum

$350,000-$3.5 million


  • Up to 2 years interim construction period
  • 7-10 years on equipment
  • 10-20 years on real estate
  • Up to 7 years for working capital
  • Up to 10 years for equipment or business acquisition
  • Up to 25 years for real estate
  • 7-year term with first-year revolving option and balance amortized across the remainder of the term

SBA Patriot Express loans

SBA Patriot Express loans are available to applicants who qualify for SBA, own more than 51% of the business and are either:

  • Veterans
  • Active-duty military
  • Reservist or National Guard
  • Spouse of the above

Applications for SBA Patriot Express and Express loans are only accepted when conventional financing options do not apply. All SBA loan applications must meet both SBA and Bank of America lending guidelines.

Are you eligible for an SBA loan?

SBA loans from Bank of America are for businesses that are:

  • Owner-operated
  • For profit
  • Legally organized (for example, as a sole proprietorship, corporation, partnership or limited liability company)
  • Within the size guidelines designated by the SBA
  • Generally unable to receive conventional credit under reasonable terms

All SBA loan applications must meet both SBA and Bank of America lending guidelines.

Things to know

5 things you should know about SBA loans

The SBA backs loans, they don’t lend money. Understanding a little more about loans backed by the Small Business Administration can help you decide whether they’re right for your business.

  1. The SBA does not engage in direct lending The SBA offers a variety of loan programs for very specific purposes. When you apply for an SBA loan, though, you do so through a bank, not through the SBA itself. While the bank is providing the actual loan, the SBA is guaranteeing a portion of that loan. In effect, the SBA is serving as a co-signer, which in turn helps banks provide more flexible terms to borrowers.
  2. Not all banks offer the same SBA programs The SBA has several loan programs, including 7(a) for general small business loans, 504 for real estate and equipment, microloans and disaster loans. An SBA loan must first be approved by the issuing bank, which may choose which programs to offer. Also, the lending requirements for any given SBA loan may vary from bank to bank, depending on specific bank policies.
  3. SBA loan programs are not just for new businesses The SBA exists to provide small businesses with financial assistance programs that have been specifically designed to meet key financing needs, including debt financing, surety bonds and equity financing. While many entrepreneurs and new businesses look to the SBA for financing, many established business take advantage of SBA-backed lending each year.
  4. An SBA loan means additional paperwork Applying for an SBA loan means you need to provide paperwork to both the bank and the SBA. In addition to the documentation a bank will typically require (see a list of Bank of America requirements), the SBA requirements (some of which may also be bank requirements) typically include an SBA loan application, a business plan, a personal financial statement, 3 years of business financial statements, 3 years of federal business tax returns, a one-year cash flow projection, information about all owners and an explanation of how a loan will help the business; and a copy of the business lease or proposed terms. By the way, that’s not a complete list; other documentation and information may be requested.
  5. You can get better terms with an SBA loan SBA loans are designed to help borrowers who may not meet the lending standards set by most banks. These can include issues such as a recent change in business ownership, a shortfall in collateral to secure the loan, business principals who have a low net worth or the need for extended payment terms.


  • Show AnswerWhat is a Small Business Administration (SBA) loan?

    The SBA is a federal agency that helps established businesses grow and helps new businesses get started. As a borrower, you’re not borrowing from the SBA, you’re borrowing from a financial institution like Bank of America that works with the SBA to provide loans to small business customers.

  • Show AnswerIs an SBA loan only for a new business?

    No. Bank of America provides SBA loans to many established businesses so they can grow and expand.

  • Show AnswerWhat's the difference between an SBA loan and a business loan from Bank of America?

    A conventional business loan from Bank of America is solely the bank’s risk and is subject to Bank lending guidelines. An SBA Express or 7(a) program loan, on the other hand, is a business loan that splits the risk between the Bank and the SBA, which guarantees a portion of those loans. Because of this split risk, SBA loans are subject to the lending guidelines of both the SBA and Bank of America, which in turn is able to take on more risk and provide more flexible terms.

    SBA 504 (the third SBA program in which Bank of America participates) is an SBA loan participation program in which Bank of America directly lends a portion of the total financing need, with the remainder being lent by the Certified Development Company (CDC). The CDC portion is guaranteed by the SBA.

  • Show AnswerIs an SBA loan from one bank the same as from another bank?

    No. An SBA loan must still be approved by the issuing bank, and each bank has its own lending criteria. You should discuss specific terms with a bank representative to understand all the terms of your loan. In addition, a bank that's an SBA Preferred Lender is likely to provide you with better terms and a smoother application and closing process than a bank that is not an SBA Preferred Lender.

  • Show AnswerIs Bank of America an SBA Preferred Lender?

    Yes. This means we meet all Preferred Lender Program eligibility criteria, including a proficiency in processing and servicing SBA-guaranteed loans. As an SBA Preferred Lender, we're part of the SBA's effort to streamline the procedures necessary to provide financial assistance to the small business community. Learn more about SBA Preferred Lenders

  • Show AnswerWhat types of SBA loans are available from Bank of America?

    Bank of America primarily offers 2 SBA loan products: SBA 7(a) for equipment, inventory, working capital, purchasing an existing business or refinancing business debt and SBA 504 for real estate construction or the purchase of land, a building or long-term equipment. Under certain circumstances, we also offer SBA Express (including Patriot Express) for equipment and working capital.

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Learn more

U.S Small Business Administration Visit the website to learn more about SBA loan programs.