Glossary · The loan itself
Lender Spread
In short
The difference between the base interest rate (like WSJ Prime or Term SOFR) and the actual interest rate you pay on an SBA 7(a) loan. This spread is fixed for the life of the loan.
What it means in a deal
Your SBA 7(a) loan's interest rate is typically variable, calculated as a base rate (e.g., WSJ Prime) plus the lender spread. The SBA caps this spread at 2.75% over the base rate for loans over $50,000. This fixed spread means your payments will fluctuate with the base rate.
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 Lender Spread
- What is the maximum interest rate spread a lender can add over the base rate for an SBA 7(a) loan?
- 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?
- How is a lender's 'SBA Preferred Lender' status beneficial for the borrower?
- How quickly can an SBA 7(a) loan be approved if my lender is a Preferred Lender Program (PLP) participant?
- What factors allow a lender to use their delegated authority (e.g., Preferred Lender status) to speed up SBA loan approval?
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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