Keeping up-to-date with SBA loan guideline changes.

Subject: 7(a) FY 2024 Fee Notice

SBA Fees have been significantly reduced or eliminated for loans less than $2.0 MM beginning October 1, 2023!

SBA issued Information Notice 5000-848801, 7(a) Fees Effective October 1, 2023, for Fiscal Year 2024. The new fees will be effective for loans approved by SBA during the period October 1, 2023, through September 30, 2024.

The fiscal year 2024 lender’s annual service fee (monthly fee) will be:

• For loans with a gross approval amounts (guaranteed and unguaranteed portions) of $1 million and less – zero.
• For loans with gross approval amounts (guaranteed and unguaranteed portions) greater than $1 million – 0.55% of the guaranteed portion of the outstanding balance of the loan.

The annual servicing fee paid by the lender has been eliminated for all loans under $1.0 MM! (Lenders, now is the time to re-think your SBA strategy!)

The SBA Guaranty Fee (Upfront Fee) for loans with maturities greater than 12 months [excluding Export Working Capital Program (EWCP) loans and SBA Express loans made to veteran-owned businesses] the SBA Guaranty Fee (Upfront Fee) will be:

• For loans with gross approval amounts (guaranteed and unguaranteed portions) of $1 million or less – zero.
• For loans with gross approval amounts (guaranteed and unguaranteed portions) over $1 million up to and including $2 million –
  • 45% of the guaranteed portion of the loan up to and including $1 million (for example $1 million dollar loan the guaranty is 75%, or $750,000. The fee is $10,875 or 1.0875% of the full loan amount) and
  • 70% of the guaranteed portion of the loan over $1 million up to $2 million (for example $2 million dollar loan the guaranty is 75%, or $1,500,000. The fee is $25,500 or 1.275% of the full loan amount)

Borrowers, with terms on SBA loans that extend well beyond a conventional bank loan, with much higher leverage (lower down payment), there is simply no reason not to consider an SBA loan for your next project!

• For loans with gross approval amounts (guaranteed and unguaranteed portions) over $2 million –no change in these loan fees for borrower or lenders:
  • 50% of the guaranteed portion of the loan up to and including $1 million and
  • $3.75% of the guaranteed portion of the loan over $1 million.

Please see the notice for information regarding the fees charged when two or more loans with maturities longer than 12 months are approved within 90 days of each other, and when there is an increase in the original loan approval amount. Please also refer to the notice for information regarding the FY 2024 fees that will apply to SBA Express loans made to veteran-owned small businesses and to EWCP loans.