Business guide
SBA Loans, Explained
The U.S. Small Business Administration doesn’t lend directly — it guarantees loans made by banks and community lenders, which is why SBA-backed loans can work when a plain bank loan won’t. Here’s what each program is for and how to actually get one.
The three programs that matter
- 7(a) loans — up to $5 million. The flagship: working capital, equipment, refinancing, even buying real estate or a business. The one most people mean when they say “SBA loan.”
- 504 loans — for big fixed assets. Long-term, fixed-rate financing to buy or renovate your building or heavy equipment, delivered through Certified Development Companies. If your goal is to own your storefront instead of renting it, this is the program.
- Microloans — up to $50,000. Small loans for startups and very small businesses, made through nonprofit community lenders that also provide coaching.
How to get one — five steps
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Get your house in order
Lenders will ask for a business plan, financial statements or projections, personal and business credit history, and how much you need for exactly what. SCORE mentors and NYC SBS advisors will help you prepare this for free.
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Pick the right program
7(a) loans (up to $5 million) are the general-purpose flagship — working capital, equipment, real estate. 504 loans finance major fixed assets like buying your storefront, through Certified Development Companies. Microloans (up to $50,000) fit startups and very small businesses and come through nonprofit community lenders.
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Find a lender
The SBA guarantees the loan but a bank, credit union, or nonprofit lender makes it. Use SBA’s Lender Match tool to get matched with participating lenders, and consider community lenders (CDFIs) for smaller amounts.
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Apply and answer fast
Submit the lender’s application with your documents. Expect questions about cash flow, collateral, and your own investment in the business — quick, complete responses keep the file moving.
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Close and put it to work
If approved, review the terms with your advisor before signing, then use the funds exactly as stated in the application — lenders can audit use of proceeds.
Official links
- SBA 7(a) loans
- SBA 504 loans
- SBA microloans
- SBA Lender Match — get matched with participating lenders.
- SBA New York District Office — the local SBA presence for NYC.
Rates, fees, and eligibility are set by the SBA and the individual lender and change over time — confirm current terms on sba.gov and with the lender before you apply.
More business guides: NYC permits & licenses · MWBE certification · small business hub