The Small Business Administration closed fiscal year 2025 with record capital deployed to small businesses: $44.8 billion across 84,400 loans. That is 1,600 loans per week worth $860 million. If you have been considering SBA financing for your business, the pipeline is moving and the programs are accessible. Here is what you need to know to position yourself for approval.
What Is Available
7(a) Loans. The flagship SBA program accounted for 77,600 loans totaling $37 billion. These are general-purpose loans usable for working capital, equipment, real estate, refinancing, and business acquisition. Maximum loan amount is $5 million with terms up to 25 years for real estate and 10 years for equipment and working capital.
504 Loans. The real estate and heavy equipment program delivered 6,750 loans totaling $7.8 billion. These are structured as two loans: typically 50% from a conventional lender, 40% from a Certified Development Company backed by the SBA, and 10% from the borrower. Maximum SBA portion is $5.5 million. Rates are favorable because the SBA debenture is backed by a government guarantee.
Manufacturing Fee Waivers. If your business is in manufacturing (NAICS codes 31-33), the SBA is waiving most upfront fees for fiscal year 2026. For 7(a) loans up to $950,000, the upfront fee is zero. For all 504 loans, both upfront and annual service fees are waived. This is a substantial savings: on a $500,000 7(a) loan, the standard guarantee fee would be around $17,500.
What Changed in Underwriting
The SBA revised its underwriting standards in April 2025, effective June 1. Key changes include a higher collateral requirement with a $50,000 threshold, a mandatory 10% equity injection for startups, and a minimum business credit score of 165. Tax transcript verification through the IRS is also required. These changes tightened the standards but also made the approval process more predictable.
How to Prepare
Get your financials current. Lenders want to see two to three years of tax returns, year-to-date profit and loss statements, and a balance sheet. If your books are not up to date, start there.
Check your credit. Both personal and business credit scores matter. The 165 minimum business credit score is a threshold, not a target. Stronger scores get better terms and faster approvals.
Have a use-of-funds plan. SBA loans are purpose-specific. “Working capital” is acceptable, but you will get further with a clear plan showing how the funds will generate revenue or reduce costs.
Start with an SBA-preferred lender. Preferred lenders have delegated authority to approve loans without additional SBA review, which speeds up the process significantly. Your local SBDC can help you identify preferred lenders in your area.