SBA loans are incredibly popular because they are known for offering the best rates in the market. In 2020, SBA loans reached a record high for lending. The SBA closed on almost nine million loans worth $750 billion.
Now is one of the best times in the history of the SBA to get a loan, but what can you expect to pay for an SBA loan? If you would like to know more about SBA loan fees and what you can expect to pay, read on. In addition, try out our free SBA loan calculator tool that will give you an accurate amount of what you can expect to save on an SBA loan currently with the promotions they have going on.
How Much Does An SBA Loan Cost?
Various factors affect the cost of an SBA loan. Different types of SBA loans have a variety of terms and interest rates. Currently, small businesses in the US can borrow amounts up to $5 million and can borrow for up to 25 years. However, standard 7(a) SBA loans typically have terms of 10 years.
What Are Typical Closing Costs For SBA Loan?
- Packaging Fees: $2,500 – $5,000
- Appraisal Fees: $1,250 to $5,000
- Business Valuation Fees: $5,000 to $30,000
- Environmental Report Fees: $2,000 to $3,000
- Title Fees: $1,000 to $2,000
- Attorney Fees: $2,000 to $3,000
When calculating the cost of an SBA loan, you need to think about more than just the interest rate. There are additional costs that you will incur at closing. Sometimes these will be wrapped up in the total of your loan. Other times you may pay these costs upfront to obtain the loan.
Some typical closing costs you can expect to pay when obtaining an SBA loan include:
Packaging Fees: With all the paperwork that needs to be put together and organized along with all the background and credit checks that need to be done there are costs involved in this for the lender. These expenses usually are covered in a packaging fee the lender will require in the due diligence period before the loan is actually approved. The usual fee for this is between $2,500 – $5,000. This is a fee that will have to be paid prior to close but may be refunded or portions of it be refunded if the loan does not close for some reason that is not the fault of the borrower misrepresenting information.
Appraisal Fees: If you are using property or another asset as collateral on your loan, you will need to have it appraised. Fees can range greatly depending on the state. In Illinois, commercial real estate appraisals can range from $1,250 to $5,000.
Business Valuation Fees: If you plan to use your SBA loan to purchase a business, that business will need to be appraised. Business valuations fees also vary, depending on the type of business you are buying and how complicated the valuation is. You can expect to pay between $5,000 to $30,000.
Environmental Report Fees: If you are making a commercial real estate purchase with your loan amount, your lender will likely require you to complete an environmental report. It will highlight any risk from the environment that may affect the property and its value in the future. These surveys can cost between $2,000 to $3,000.
Title Fees: If you are investing in real estate for your business, you will need to ensure that it has a clean title before making your purchase. Fees for searches and filing your new title at closing will range from $1,000 to $2,000.
Attorney Fees: With all the paperwork that taking out a loan requires, you will need an attorney to review it. Attorney fees for evaluating your loan documents will typically cost from $2,000 to $3,000.
SBA Fee Savings Loan Calculator
If you are considering an SBA loan, you can use our free SBA fee loan savings calculator to figure out how much you will save right now since they are waiving their fees. That’s right, the SBA is currently not charging the normal SBA fee which is usually between 3-4% of the total amount borrowed. This can be a huge saving considering how much you are borrowing. Try it below for free today!
Here is an example of how to calculate your SBA fees if you borrowed $1M:
$1,000,000 loan X 75% of the loan guaranteed = $750,000
$750,000 X 3.5% SBA fee = $26,250 loan cost
Currently, you would pay $0, saving your business $26,250!
The SBA is waiving its loan fees until September 2021 or when the money runs out.
The SBA is also making the first three months of payments for you on all SBA loans up to $9,000 per month. This is for a limited time until September or until the money allotted from Congress runs out. Don’t delay if you are in the marketplace. There is no better time in SBA history to get a loan than now with these current promotions!
Try Our SBA Fee Loan Calculator Right Now!
Thanks, we will contact you soon
Calculate your SBA savings
Loan Amount : $[item-234_quantity]
SBA Fee Savings : [item-240_price]
Plus you get 3 months paid for by the SBA!
Submit your information to us and we'll contact you to discuss your SBA Loan needs.