SBA Loans
SBA 7(a) vs SBA 504: Which Program Fits?
SBA 7(a) is the flexible, general-purpose program for working capital, equipment, acquisitions and owner-occupied real estate. SBA 504 exists for major fixed assets — it pairs a bank loan with a CDC debenture, usually on long-term fixed terms.
Side by side
| Typical use | 7(a): working capital, acquisitions, equipment |
| Fixed assets | 504: owner-occupied real estate and long-life equipment |
| Structure | 504 pairs a bank loan with a CDC debenture |
| Timeline | 7(a): ~4–8 weeks · 504: ~6–10 weeks |
Choosing
- Mostly working capital or an acquisition → lean 7(a)
- Buying owner-occupied real estate → compare 504
- Need speed → weigh a faster non-SBA option alongside
If the deal spans both needs, a lender can sometimes structure a blended approach rather than forcing a single program.
Frequently asked questions
Which has a lower down payment?
Both are designed for low borrower contribution; terms depend on the deal and lender.
Do both require a personal guarantee?
Yes, from owners with 20%+ equity.