SBA loan rates in 2026 reflect the Federal Reserve's extended pause following the December 2025 rate cut. The prime rate is 6.75% — unchanged since then. SBA 7(a) variable rates are in the 9.75–14.75% range. SBA 504 fixed rates are at 6.17–6.20% in July 2026 — significantly below 7(a) variable rates, making 504 the clear winner for eligible real estate projects on a cost-of-capital basis.
Current SBA Rates — July 2026
| Program | Rate Structure | July 2026 Rate | Key Driver |
|---|---|---|---|
| SBA 504 — 10 yr | Fixed (CDC debenture) | 6.19% | 5-year Treasury note |
| SBA 504 — 20 yr | Fixed (CDC debenture) | 6.20% | 10-year Treasury note |
| SBA 504 — 25 yr | Fixed (CDC debenture) | 6.17% | 10-year Treasury note |
| SBA 7(a) — Large (>$350K) | Variable (Prime + spread) | 9.50–11.50% | Prime rate (6.75%) |
| SBA 7(a) — Small (≤$350K) | Variable (Prime + spread) | 11.75–14.75% | Prime rate (6.75%) |
| SBA Express | Variable (Prime + spread) | 11.25–13.25% | Prime rate (6.75%) |
| SBA Microloan | Fixed (intermediary sets) | 8–13% | Intermediary cost of funds |
How SBA 504 Rates Are Set
SBA 504 CDC rates are set monthly based on Treasury note yields plus SBA fees and CDC servicing costs. The rate is fixed at closing for the full term of the debenture — it does not reprice. The total effective CDC rate includes the base Treasury yield plus an SBA guarantee fee, a CDC servicing fee, and a central servicing agent fee. In July 2026, the SBA Optional Peg Rate is 4.75% for Q3 2026.
The bank's 50% portion is priced separately by the lender — typically at Prime + a spread, variable. The blended effective rate for the full 504 project (bank + CDC portions combined) is usually 7.0–8.5% in July 2026, depending on the bank's rate on their portion.
How SBA 7(a) Rates Are Set
SBA 7(a) rates are structured as Base Rate + Lender Spread. Lenders can choose from several base rates including Prime, SOFR, or Treasury Notes. The SBA caps the maximum allowable spread based on loan size and term:
- Loans > $50,000, term > 7 years: Prime + 2.75% maximum (9.50% at July 2026 prime)
- Loans > $50,000, term ≤ 7 years: Prime + 2.25% maximum
- Loans $25,001–$50,000: Prime + 3.25% maximum
- Loans ≤ $25,000: Prime + 4.25% maximum
The rates above are maximums. Preferred Lender Program (PLP) lenders with strong borrower relationships often price below maximum. For highly qualified borrowers, rates in the 9.5–10.5% range are achievable in July 2026.
Rate History — SBA 7(a) Prime Rate Basis
| Date | Prime Rate | 7(a) Max (Large Loan) | 504 20-yr Rate |
|---|---|---|---|
| Jan 2022 | 3.25% | 6.00% | ~3.0% |
| Jan 2023 | 7.50% | 10.25% | ~6.0% |
| Jan 2024 | 8.50% | 11.25% | ~6.5% |
| Jan 2025 | 7.50% | 10.25% | ~6.3% |
| Jul 2026 | 6.75% | 9.50% | 6.20% |
What Happens to Your Rate If the Fed Cuts Again?
SBA 7(a) variable rates move directly with the prime rate — typically within the same quarter. If the Fed cuts 25 basis points, prime drops 25 basis points, and your 7(a) rate follows. A 100 basis point cut (one full percentage point) on a $1M 7(a) loan at 11% over 10 years reduces the monthly payment by approximately $540/month — $6,480/year.
SBA 504 fixed rates do not change after closing. If rates drop after your 504 closes, your CDC portion stays at the rate locked at closing. This is a trade-off: the predictability of fixed rates is valuable even if it means missing out on future cuts.
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