Fixed-Rate SBA Debt?

February 28, 2024

by a searcher from Baruch College-The City University of New York - The Zicklin School of Business in Miami, FL, USA

I've been hearing recently of some SBA lenders offering fixed-rate debt rather than the typical floating rate loans. Has anyone utilized this before, or know which lenders offer this product?

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Reply by a lender
from University of Florida in Dallas, TX, USA

Almost every bank out there (that does not sell their loans) is offering fixed rate SBA debt. Mine personally offers Fixed for 3-years (then reset to WSJP + spread peg), Fixed for 5-years and fully floating calendar quarterly. Be mindful of the overall macroeconomic environment when choosing your rate. Banks that have historically never offered fixed rate debt are publicly advertising it. Banks in general are betting that WSJP will go down in the relatively near future, so they want to lock you in to higher fixed rate debt.

While it is "easier" for cash flow modeling to utilize fixed rate debt, often times it is worth the risk to go variable. Happy to discuss further as needed.

Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA

^redacted‌. Thank you for putting me on this. Over 90% of the SBA 7A market is variable rate loans. There are some Banks, typically local to the market deals are in, that will offer fixed rate loans. However, usually the underwriting criteria are tighter for those Banks than it is for the Banks that specialize in SBA 7A financing. So it somewhat depends on the deal you are working on and where it is at. I would be happy to have a discussion and go over options with you. You can reach me at redacted Good luck.

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