Glossary · The loan itself
Fixed Spread SOFR
In short
A common index used for variable interest rates on SBA 7(a) loans, consisting of the SOFR rate plus a fixed spread. This combination determines a portion of your actual interest rate.
What it means in a deal
For a variable rate SBA loan, your interest rate will often be Fixed Spread SOFR + a margin. The SOFR component fluctuates, while the spread is fixed by the lender. Understand how this index works and its historical volatility, as it directly impacts your future monthly loan payments and overall debt service.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Fixed Spread SOFR
- What is the difference between the base rate and the spread on an SBA 7(a) loan?
- What are the maximum allowable interest rates for variable rate 7(a) loans, including the permissible spread?
- What is the maximum interest rate spread a lender can add over the base rate for an SBA 7(a) loan?
- What are the specific requirements for an alternative base rate, like SOFR, to be used for a 7(a) variable rate loan?
- If a lender wishes to use SOFR as a base rate for a variable rate 7(a) loan, what specific documentation is required?
- Can a lender change the base rate option (e.g., from Prime to SOFR) for a variable rate 7(a) loan after closing?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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