SBA Loan Fees for FY2027: 7(a) Guaranty Fee and 504 Fees
For federal fiscal year 2027, which began on 1 October 2026, SBA cut the 7(a) zero-upfront-fee ceiling for manufacturers from $950,000 to $700,000 and extended the 0% to food supply chain businesses and businesses located in a rural area, at $700,000 or less. That is Information Notice 5000-881797. Other 7(a) loans over 12 months pay 2% of the guaranteed portion at $150,000 or less, 3% from $150,001 to $700,000, and above that 3.5% of the first $1,000,000 guaranteed plus 3.75% of the rest; EWCP, WCP and veteran SBA Express loans have their own schedules. At a 75 percent guaranty, such a $900,000 loan to a manufacturer paid $0 upfront in FY2026, MARC loans excepted, and pays $23,625 in FY2027. The 504 notice, 5000-881796, waives its two SBA fees, 0.50% upfront and 0.203% a year, for the same three classes; CDC fees still apply.
This is general information, not legal or lending advice. We are not a lender, a CDC or attorneys. SBA sets these fees for each fiscal year by Information Notice and calculates the 7(a) Upfront Fee on the amount it approves. Confirm your fee, your NAICS code and whether you count as rural with your lender or CDC before relying on the 0%.
How much is the SBA guarantee fee in FY2027?
For a 7(a) loan over 12 months approved 1 October 2026 to 30 September 2027, other than an EWCP, WCP or veteran SBA Express loan, it is 0% for manufacturers, food supply chain and rural-area businesses at $700,000 or less, otherwise 2%, 3% or, in the top tier, 3.5% and 3.75% of the guaranteed portion; the gross loan amount picks the tier. The notice calls it the SBA Guaranty Fee or Upfront Fee.
| Loan, by gross approval amount | FY2027 upfront fee, Notice 5000-881797 |
|---|---|
| $700,000 or less to a manufacturer, a food supply chain business or a business located in a rural area; no maturity condition stated | 0% |
| $150,000 or less, over 12 months | 2% of the guaranteed portion; the lender may keep up to 25% of it |
| $150,001 to $700,000, over 12 months | 3% of the guaranteed portion |
| $700,001 to $5,000,000, over 12 months | 3.5% of the guaranteed portion up to $1,000,000, plus 3.75% above that |
| 12 months or less | 0.25% of the guaranteed portion |
| SBA Express to a business owned and controlled by a veteran or spouse of a veteran | $0 |
| EWCP and WCP loans | own schedules by maturity in the notice |
The three tiers are the statutory maxima in 15 U.S.C. § 636(a)(18). The FY2026 notice printed the same tiers.
Who pays 0% upfront in FY2027, and what changed from FY2026?
Three classes, at $700,000 or less: manufacturers, food supply chain businesses under listed NAICS codes, and businesses located in a rural area.
For loans of $700,000 or less, to manufacturers (NAICS sectors 31-33), food supply chain (NAICS Codes 1111, 1112, 1113, 1121, 1122, 1123, 1124, 1125, 1129, 1141, 1151, 1152, 423820, 4244, 4245, 424910, 445110
The list continues with 484220, 484230, 493120 and 493130 and closes: "and businesses that are located in a rural area, the Upfront fee is 0%". Footnote 1: "NAICS 484220 and 484230 are limited to refrigerated and frozen trucking, farm products, grain products, and livestock". The 504 notice prints the same 21 codes.
The FY2026 notice, 5000-872051, had one class and a higher ceiling: "For loans to manufacturers (NAICS sectors 31-33) of $950,000 or less, the upfront fee is 0% (does not apply to MARC loans)". MARC is the 7(a) Manufacturers' Access to Revolving Credit loan.
Neither notice defines rural or says which location of a business counts. SOP 50 10 8.1, Appendix 3, has a definition:
Rural Area: 7(a) and 504: An area located in a county that the US Census Bureau has defined as at least 30 percent rural.
Our reading is that the fee relief uses it, making the test the county, not the street address; the notices do not say so. The definition points to the Census Bureau's County-level Urban and Rural Information: check your county, then ask the lender which address it will use.
In dollars, for Standard 7(a) loans over 12 months at their 75 percent maximum guaranty:
| Case | Guaranteed portion | FY2026 upfront fee | FY2027 upfront fee |
|---|---|---|---|
| Manufacturer, $900,000, not a MARC loan | $675,000 | $0 | $23,625 (3.5% of $675,000) |
| Rural-area business, not a manufacturer, $700,000 | $525,000 | $15,750 (3%) | $0 |
At $700,001 the manufacturer pays 3.5% of the $525,000.75 guaranteed, $18,375.03 after rounding.
Is the SBA guarantee fee charged on the whole loan or the guaranteed portion?
On the guaranteed portion. SOP 50 10 8.1:
The total loan amount determines the percentage that is used to calculate this fee. However, the Upfront Fee is based on the guaranteed portion of the loan and not the total loan amount.
13 CFR 120.210 sets a maximum guaranty of 85 percent for loans of $150,000 or less and 75 percent above that, "except as otherwise authorized by law". On a $2,000,000 loan over 12 months at that maximum, the guaranteed portion is $1,500,000 and the FY2027 fee is $53,750: 3.5% of $1,000,000 ($35,000) plus 3.75% of $500,000 ($18,750).
Can the lender pass the guarantee fee to you, and can you finance it?
Yes to both. SOP 50 10 8.1: "The 7(a) Lender is permitted to pass the cost of the Upfront Fee to the Borrower." 13 CFR 120.220(b) sets the financing rule:
The Borrower may use the loan proceeds to pay the guaranty fee. However, the first disbursement must not be made solely or primarily to pay the guaranty fee.
On a loan over 12 months, the SOP adds: "Once a loan has been initially disbursed, no refund is permitted."
Under the notice, WCP and EWCP scenarios aside, 7(a) loans over 12 months approved for one applicant, including its affiliates, within 90 days of each other "are considered as one loan for the purpose of determining the percentage of guaranty and the Upfront Fee calculation". Two such $400,000 loans to a manufacturer approved 60 days apart are priced as one $800,000 loan: at a 75 percent guaranty the combined fee is $21,000 (3.5% of $600,000), charged on the second loan less the $0 on the first.
What is the SBA lender's annual service fee, and who pays it?
On a 7(a) loan the lender pays it, and it may not be charged to you. For FY2027 Notice 5000-881797 sets it at "0.55% of the outstanding balance of the guaranteed portion of each loan". 15 U.S.C. § 636(a)(23) caps the fee at 0.55 percent a year and says it "shall be payable by the participating lender and shall not be charged to the borrower".
What are the SBA 504 loan fees for FY2027?
The two SBA fees Notice 5000-881796 sets are 0.50% upfront and 0.203% a year of the outstanding balance (0.204% under Debt Refinance without Expansion). The notice waives both for manufacturers, food supply chain and rural-area businesses, with no dollar ceiling stated. CDC and other fees still apply.
Three fee changes from the FY2026 notice, 5000-871532: the annual fee was 0.209%, the Debt Refinance without Expansion total was 0.2115%, and the waiver named manufacturers only.
SOP 50 10 8.1 prices a debenture in steps (Section C, Chapter 3): "Except for the underwriting fee and closing costs, each administrative cost is based on the amount of the Net Debenture." For a borrower outside the three classes, on a $1,000,000 Net Debenture for 20 or 25 years, with the maximum processing fee and an assumed $2,500 of financed closing costs:
| Charge | Rate and base | Amount |
|---|---|---|
| SBA upfront guaranty fee | 0.50% of the Net Debenture (SOP); "on the Debenture" in 13 CFR 120.971(d)(1) | $5,000 |
| Funding fee | 0.25% of the Net Debenture (SOP); "not to exceed 0.25 percent of the Debenture" in 13 CFR 120.971(e) | $2,500 |
| CDC processing fee | up to 1.5% of the Net Debenture, 13 CFR 120.971(a)(1) | $15,000 |
| CDC closing fee | reasonable, no dollar cap stated, 13 CFR 120.971(a)(2); up to $10,000 may be financed, 120.883(e) | $2,500 financed (assumed) |
| Gross Debenture | the $1,025,000 total divided by 0.996, rounded up to the next even thousand | $1,030,000 |
| Underwriter's fee | 0.4% of the Gross Debenture | $4,120; the $880 left over goes to the borrower |
| SBA annual service fee | 0.203% of the outstanding balance | $2,090.90 a year at the full $1,030,000 |
| CDC servicing fee | at least 0.625% and at most 2% a year of the unpaid balance, 13 CFR 120.971(a)(3) | at least $6,437.50 a year at the full $1,030,000 |
This is not the full list: the SOP's fee table also has CSA fees, late and assumption fees, and a participation fee on the Third Party Lender's loan. Our free SBA equity calculator gives the 504 contribution; SBA 504 loan requirements covers eligibility.
What other fees can an SBA 7(a) lender charge you?
On a 7(a) loan, only those in 13 CFR 120.221, unless SBA Loan Program Requirements allow otherwise: packaging and service fees, extraordinary servicing, out-of-pocket expenses, a late payment fee and hourly legal fees. SOP 50 10 8.1: "Any fee not expressly permitted in 13 CFR § 120.221 is prohibited."
Packaging is the fee to watch, because the SOP's packaging services "include assisting the Applicant with completing one or more applications, preparing a business plan, cash flow projections, and other documents related to the application". A percentage fee is capped at the lesser of the lender's own rate on similarly-sized non-SBA loans or "5% for loans $150,000 or less" and "3% for loans in excess of $150,000", with a $30,000 maximum. And "The Applicant may not be charged for the same service by two different entities", so tell the lender what you have already paid for.
A 7(a) borrower can also owe SBA the Subsidy Recoupment Fee (13 CFR 120.223): on a loan with a maturity of 15 years or longer, voluntarily prepaying more than 25% of it in any one of the first three years after first disbursement costs 5%, 3% or 1% of the prepayment, by year.
What should your business plan show about SBA fees?
No rule we read requires a plan to show fees. We put in four things. First, the fee in the sources and uses if you finance it, because then "the SBA Terms and Conditions must include a Use of Proceeds category for this purpose". Second, the NAICS code, which decides the manufacturer and food supply chain 0%. Third, the county where the business is located, for the rural test as we read it. Fourth, every fee the lender charges, because the lender owes you that list: "The Lender must itemize for the Applicant in writing any fees charged in association with the 7(a) loan."
Our SBA loan business plans are published at $1,000 Essential, $1,800 Standard and $2,500 Premium, fixed, and a matching financial model starts at $750. We never charge a percentage of anything you borrow, invest or raise. See whether the SBA requires a business plan and our SBA loan business plan service.
Business Plan Firm is the US practice of Avvale, a London consultancy. We have written 1,000+ plans for 500+ founders across 30+ countries, and our clients have raised $500M+.
How we verified this
Every quotation was checked character for character against raw source files downloaded on 6 and 10 October 2026.
- SBA Information Notices 5000-881797 (7(a)) and 5000-881796 (504), published 3 September 2026: the FY2027 fees and relief classes. PDFs at sba.gov (7(a)) and sba.gov (504).
- SBA Information Notices 5000-872051 and 5000-871532, the FY2026 fee notices, for the comparison: sba.gov (7(a)) and sba.gov (504).
- SBA SOP 50 10 8.1, effective 1 October 2026, as posted on SBA's SOP page on 10 October 2026: Section A, Chapter 4, Para. C and E (fee rules); Section C, Chapter 3 (Gross Debenture steps); Appendix 3 (Rural Area). Word file at sba.gov.
- 15 U.S.C. § 636(a)(18) and (a)(23), the statutory fee ceilings and who pays the annual fee, at the Legal Information Institute.
- 13 CFR 120.210, 120.220, 120.221, 120.883 and 120.971 (guaranty maximums and fee rules), quoted from the govinfo.gov edition revised as of 1 January 2025: 120.210, 120.220, 120.221, 120.883, 120.971. The current text at the Legal Information Institute, where we also read 120.223, was the same on 10 October 2026, with no amendment shown after October 2023.
We found no FY2027 fee document in the Federal Register in API searches on 6 and 10 October 2026, and no newer fee notice in SBA's document library on 10 October. Not verified, so not on this page: how SBA's systems assign the rural designation, whether the FY2027 0% reaches MARC loans and why SBA lowered the manufacturer ceiling.
Frequently asked questions
How much is the SBA guarantee fee in 2027 (federal fiscal year 2027)?
For 7(a) loans over 12 months approved in federal fiscal year 2027, other than EWCP, WCP and veteran SBA Express loans, Notice 5000-881797 sets 0% at $700,000 or less for manufacturers, food supply chain and rural-area businesses, otherwise 2% of the guaranteed portion at $150,000 or less, 3% from $150,001 to $700,000, and above that 3.5% of the first $1,000,000 guaranteed plus 3.75% of the rest.
Is the SBA guarantee fee waived for loans under $700,000?
Not for every borrower. Notice 5000-881797 sets 0% upfront on 7(a) loans of $700,000 or less to manufacturers, listed food supply chain businesses and businesses located in a rural area. Other 7(a) loans over 12 months at that size pay 2% or 3% of the guaranteed portion; EWCP, WCP and veteran SBA Express loans have their own schedules.
What counts as a rural area for the SBA fee waiver?
SOP 50 10 8.1, Appendix 3, defines Rural Area as an area located in a county that the US Census Bureau has defined as at least 30 percent rural. The FY2027 SBA fee notices do not define rural; our reading is that the fee relief uses that county test.
What is the SBA 7(a) annual service fee in FY2027?
The FY2027 7(a) Lender's Annual Service Fee is 0.55% of the outstanding balance of the guaranteed portion of each loan, under Notice 5000-881797. The lender pays it, and 15 U.S.C. § 636(a)(23) says it shall not be charged to the borrower.
What are the SBA 504 loan fees for FY2027?
Notice 5000-881796 sets two SBA 504 fees for FY2027, 0.50% upfront and 0.203% a year of the outstanding balance, and waives both for manufacturers, food supply chain and rural-area businesses. CDC fees still apply, including a servicing fee of at least 0.625% a year.
This page summarizes SBA Information Notices 5000-881797, 5000-881796, 5000-872051 and 5000-871532, SOP 50 10 8.1, 15 U.S.C. § 636 and 13 CFR Part 120 as retrieved on 6 and 10 October 2026. It is general information, not legal, lending or tax advice, and we are not a lender, a CDC or attorneys. Confirm current fees, your NAICS code and your county's rural classification with your lender before acting.