Glossary · The loan itself
Maximum permitted spread
In short
The highest interest rate margin a lender can charge above the base rate (like WSJ Prime or SOFR) on an SBA loan. This limit is set by the SBA to protect borrowers.
What it means in a deal
The SBA regulates how much interest lenders can charge on 7(a) loans. The interest rate is variable, based on a base rate plus a 'spread.' While the maximum spread ensures lenders don't overcharge, you should still negotiate for the lowest possible rate within that limit.
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 Maximum permitted spread
- 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 is the difference between the base rate and the spread on an SBA 7(a) loan?
- When is a lender permitted to waive environmental due diligence requirements for real estate collateral?
- When is the use of a fixed interest rate permitted for an SBA 7(a) loan?
- What are the permitted alternative base rate options for variable-rate 7(a) loans beyond the Prime Rate?
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.
See which SBA lenders would fund your deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to approve a 7(a) like yours and flag what trips up approval.
Free · No documents · Usually same-day
Backed by data on 1,000+ SBA lenders and 300,000+ funded deals. Your details go only to lending partners you ask to be matched with — never sold to advertisers.