SBA 7(a), 504 or Express: which to ask for
Three SBA loan types, and which one to ask a lender about for what you're paying for.
Updated First published Published by BizLoan.now
SBA has three loan types that most small businesses choose between. The right one depends mostly on what you're paying for and how much you need.
The short version
- Buying or building real estate, or major long-life equipment: ask about a 504 loan.
- Working capital, buying a business, equipment or mixed uses up to $5 million: ask about a 7(a) loan.
- A smaller amount, up to $500,000, where you want the lender to decide faster: ask about SBA Express.
Side by side
| Compare | 7(a) (Standard and Small) | SBA Express | 504 |
|---|---|---|---|
| Maximum | $5 million | $500,000 | $5.5 million for the SBA-backed portion |
| SBA guaranty to the lender | 7(a) Small (up to $350,000): 85% on $150,000 or less, 75% above. Standard ($350,001 to $5 million): 75% | 50% | The CDC portion is SBA-backed |
| Term | Generally up to 10 years; up to 25 for real estate | Generally up to 10 years; up to 25 for real estate | 10, 20 or 25 years |
| Your down payment | Set by the lender; at least 10% equity for startups and business purchases | Set by the lender | At least 10% of the project, more in some cases |
| Pays for | Working capital, equipment, real estate, buying a business, refinancing | Similar uses to 7(a), including revolving lines of credit | Real estate, buildings, long-life equipment |
| Doesn't pay for | Some restricted uses on SBA's list | Same as 7(a) | Working capital, inventory |
How 504 is structured
A 504 project usually has three parts. A private lender finances about 50%. A Certified Development Company finances up to 40% with an SBA-backed loan at a fixed rate. You put in at least 10%. Because two lenders are involved, a 504 loan usually takes longer to close.
How SBA Express differs
SBA Express lenders can make the credit decision themselves, so they often answer faster. In exchange, SBA guarantees only 50% of the loan, so some lenders are pickier about who they approve. Express can also be structured as a revolving line of credit.
Combining programs
Since July 4, 2026, one business can have up to $10 million in combined 7(a) and 504 financing. A common pairing is a 504 loan for a building plus a 7(a) loan for equipment or working capital.
Rules that apply to all three
- Every owner must be a U.S. citizen or U.S. national (since March 1, 2026). See SBA loan changes in 2026.
- The business must be unable to get similar credit elsewhere on reasonable terms.
- Owners of 20% or more give personal guarantees.
For the rules behind each program, including microloans and rate caps, see the SBA loan guide for 2026. For amounts and documents for a 7(a) loan, see how SBA 7(a) loans work.
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