Fees
SBA guaranty fee
The SBA guaranty fee (also spelled guarantee fee) is a one-time, upfront charge on the SBA-backed portion of a 7(a) loan. For fiscal year 2026 it runs 2% to 3.75% of the guaranteed portion by loan size, and it is usually financed into the loan rather than paid in cash.
These are the fees the SBA set for all 7(a) loans approved between October 1, 2025 and September 30, 2026 (Information Notice 5000-872051). The SBA resets them every fiscal year, so confirm the current figure with your lender before relying on it for a live deal.
What the guaranty fee is
When the SBA backs a 7(a) loan, it guarantees a share of the balance (typically 85% of a loan up to $150,000 and 75% above that) so the lender is repaid by the government if the borrower defaults. In return, the SBA charges a one-time upfront guaranty fee. The single most important detail: the fee is charged on the SBA-guaranteed portion of the loan, not the full loan amount. The percentage tier, though, is set by the gross (total) loan amount, including the unguaranteed portion. The fee is usually financed into the loan, so it adds to your balance rather than requiring cash at closing.
FY2026 upfront guaranty fee schedule
The tiers below apply to 7(a) loans with a maturity of more than 12 months, by gross loan amount. The fee is then charged on the guaranteed portion.
| Gross loan amount | Fee on the guaranteed portion |
|---|---|
| $150,000 or less | 2.0% |
| $150,001 to $700,000 | 3.0% |
| $700,001 to $5,000,000 | 3.5% on the first $1M guaranteed, 3.75% above |
| Maturity of 12 months or less (short-term) | 0.25% |
On loans of $150,000 or less, the lender may keep no more than 25% of the fee (at least 1.5% must be remitted to the SBA). $5,000,000 is the maximum 7(a) loan, and $3,750,000 the maximum SBA guaranty.
What the fee costs: worked examples
Each fee below is computed with the same schedule, at the standard guaranty (85% up to $150,000, 75% above). Because the fee applies only to the guaranteed portion, the effective cost as a share of the whole loan stays well under the headline percentage.
| Loan amount | SBA guaranty | Guaranteed portion | Upfront fee | Effective % of loan |
|---|---|---|---|---|
| $250,000 | 75% | $187,500 | $5,625 | 2.25% |
| $500,000 | 75% | $375,000 | $11,250 | 2.25% |
| $1,000,000 | 75% | $750,000 | $26,250 | 2.63% |
| $5,000,000 | 75% | $3,750,000 | $138,125 | 2.76% |
Run your own number with the guaranty fee calculator, which uses this exact schedule.
The annual service fee is separate
Beyond the one-time upfront fee, the SBA charges lenders an ongoing annual service fee of 0.55% of the outstanding balance of the guaranteed portion in FY2026. Unlike the upfront fee, the lender may not pass the annual service fee on to the borrower, so it does not appear on your closing statement. It is built into the economics of the loan rather than billed to you directly.
Who pays no guaranty fee in FY2026
| Who | FY2026 upfront fee |
|---|---|
| Manufacturers (NAICS 31 to 33), 7(a) loan of $950,000 or less | 0% |
| SBA Express loan to a veteran-owned business | $0 |
The manufacturer relief covers the upfront fee only; the 0.55% annual service fee still applies on 7(a) loans, and the manufacturer waiver does not apply to MARC loans. The veteran-owned exemption is set by statute (section 7(a)(31)(G) of the Small Business Act). Small-loan fee waivers have come and gone in past fiscal years, so the schedule above is the FY2026 baseline, not a permanent rule.
How it differs from the 504 fee
The 504 program has its own, much smaller fee structure. For FY2026 the 504 upfront guaranty fee is 0.50% and the annual service fee is 0.209%, both charged on the CDC/SBA debenture (roughly 40% of the project) rather than on a 7(a)-style guaranteed portion, and the 504 upfront fee is already folded into the effective debenture rate. So a 504 loan carries a far lower headline guaranty fee than a 7(a), but that is because the SBA-backed piece of a 504 deal is smaller and the pricing is structured differently. See the 504 loan rates and fees for the full 504 breakdown.
The lender's packaging fees are separate
The SBA guaranty fee goes to the SBA. It is not the same as the packaging, servicing, or closing fees a lender or loan agent may charge you directly, which are disclosed separately (on SBA Form 159 when an agent is paid). The rules, the disclosure requirements, and your refund protections are in our SBA packaging fee guide. When you compare offers, weigh those lender fees, not the guaranty fee, because the guaranty fee is the same at every 7(a) lender for a given loan.
Frequently asked questions
How much is the SBA guaranty fee?
For fiscal year 2026 (loans approved October 1, 2025 through September 30, 2026), the upfront guaranty fee is 2% of the guaranteed portion on loans of $150,000 or less, 3% from $150,001 to $700,000, and 3.5% on the first $1,000,000 of guaranteed dollars plus 3.75% above that on loans of $700,001 to $5,000,000. Short-term loans (maturity of 12 months or less) are 0.25%. The fee is charged on the SBA-guaranteed portion, not the full loan.
Is the SBA guaranty fee negotiable?
No. The SBA publishes the upfront fee and the annual service fee each fiscal year through an Information Notice, and every 7(a) lender uses the same schedule, so the rate itself is not negotiable. What you can influence is the loan size and maturity that set your tier, and whether the fee is financed rather than paid in cash.
Is the SBA guaranty fee financed into the loan?
Usually, yes. Lenders are permitted to pass the upfront guaranty fee on to the borrower, and it is typically financed into the loan balance rather than paid out of pocket at closing, so it adds to your principal and monthly payment. The separate 0.55% annual service fee is paid by the lender and cannot be charged to the borrower.
Is the SBA guaranty fee refundable if my loan is cancelled?
For a loan with a maturity of more than 12 months, the SBA refunds the guaranty fee if the lender has not made any disbursement and asks in writing to cancel the SBA guaranty (13 CFR 120.220). Once any funds are disbursed, the fee is not refunded. Short-term loans of 12 months or less have no refund provision.
Who is exempt from the SBA guaranty fee in FY2026?
For fiscal year 2026 the upfront fee is 0% on 7(a) loans to manufacturers (primary NAICS code in sectors 31, 32, or 33) of $950,000 or less, and $0 on SBA Express loans made to veteran-owned businesses. The 0% manufacturer relief covers the upfront fee only; the 0.55% annual service fee still applies on 7(a) loans. (On 504 loans, manufacturers pay 0% on both the upfront and annual fees.)
Is the guaranty fee charged on the whole loan amount?
No. It is charged on the SBA-guaranteed portion only, which is typically 85% of a loan up to $150,000 and 75% above that. The size tier that sets the percentage, however, is based on the gross (total) loan amount, including the unguaranteed portion.
See the lenders funding SBA 7(a) loans
Get matched with the SBA lenders that actually fund businesses like yours, ranked on real loan data by state, industry, and size. Independent: your details go only to the lenders we match you to, never to data brokers.