Maximum Allowed Interest Rates for Various Small Business Loans

A Basic 7(a) SBA loan has a maximum interest rate of Prime Plus 2.25 percent for small business loans of $50,000 or more, Prime Plus 3.25 percent for loans between $25,000 and $50,000 and Prime Plus 4.25 percent for small business loans of less than $25,000. The rates may be fixed or variable.

The interest rates for 504 SBA loans "are pegged to an increment above the current market rate for five-year and ten-year U.S. Treasury Issues," according to information at sba.gov.

SBA Micro-Loans are limited to no more than $35,000 and can have interest rates as high as 13%.

Home equity loans can also be used to finance a small business. The interest rates for these small business loans vary from bank to bank and are also affected by federal regulations that frequently change. Current rates average at around 7.95% for $30,000.

All in all, small business loan amounts and interest rates are a fluid entity and tend to change frequently depending on where the small business loan is established and on the state of the economy. These changes can be both large and small, and depending on whether you have a fixed or variable interest rate, can benefit or harm your finances.  Please contact us for more information about interest rates and small business loans.