Last reviewed November 2026
Each government guaranteed loan program fits a different borrower and project. This table gives community bankers a quick side-by-side view, using figures from the official sources below as of November 2026.
At a glance
| SBA 7(a) | SBA 504 | USDA B&I (OneRD) | FSA guaranteed farm loans | |
|---|---|---|---|---|
| Rules | SOP 50 10 8.1; 13 CFR 120 | SOP 50 10 8.1, Section C; 13 CFR 120 | 7 CFR 5001 | 7 CFR 762; FSA Handbook 2-FLP |
| Who lends | The bank, with an SBA guaranty | The bank (first lien) plus a CDC debenture (second lien) | The bank, with a USDA loan note guarantee | The bank, with an FSA guarantee |
| Typical uses | Working capital, equipment, real estate, business acquisitions, refinancing | Owner-occupied real estate and long-life equipment | Rural business projects: real estate, equipment, working capital, acquisitions, refinancing | Farm ownership and farm operating loans and lines |
| Size | Up to $5 million; SBA Express up to $500,000; 7(a) Small up to $350,000 | Debenture up to $5 million per business; $5.5 million per project for small manufacturers and energy projects | Up to $25 million per borrower (more only for certain rural cooperatives with the Secretary's approval) | Combined guaranteed limit of $2,558,000 for FY 2027, adjusted each year |
| Guarantee | 85% for loans of $150,000 or less, 75% above; 50% on SBA Express; SBA's share capped at $3.75 million | Debenture guaranteed 100% by SBA; the bank's loan is not guaranteed | Set each fiscal year. FY 2026: 85% for loans under $5 million, 80% from $5 million to $25 million | Up to 90%; 95% in listed cases such as qualified beginning farmers |
| Equity | 10% for start-ups and most changes of ownership; otherwise the lender's analysis | 10% minimum; 15% or 20% for new businesses and special purpose property | As set in the conditional commitment and shown on the closing balance sheet | Based on the lender's credit analysis and the conditional commitment |
| Owner guaranties | Unlimited guaranty from 20%+ owners | Unlimited guaranty from 20%+ owners on the 504 loan | Guaranty from 20%+ owners, at least their ownership share of the guaranteed amount | Entity members sign the note individually unless FSA waives it for owners under 10% |
| Who closes | The bank and its counsel | The bank closes its loans; the CDC and CDC counsel close the 504 loan and debenture | The bank closes, then certifies conditions for the loan note guarantee | The bank closes, then submits its certification and closing report |
| Fees | Upfront and annual SBA fees set each fiscal year | CDC and debenture fees, often financed | FY 2026: 3% guarantee fee and 0.55% annual retention fee for standard loans | Guarantee fee set by FSA; none on certain loans |
Choosing among them
- Owner-occupied real estate with a long fixed-rate need often fits 504, where the bank keeps a first lien on about half the project.
- Business acquisitions, working capital and mixed uses of proceeds usually point to 7(a).
- Larger rural projects, including those above SBA limits, may fit USDA B&I if the project is in an eligible rural area and the borrower meets the program's tests.
- Agricultural producers buying land or financing operations look to FSA guaranteed loans.
- Some projects combine programs, such as a 7(a) loan alongside a 504 project. SBA's rules on combined limits and the order of approvals apply.
Timing note for USDA B&I
USDA announced a pause, beginning Friday, November 20, 2026, at 5 p.m. Eastern, on new B&I applications and servicing requests until a new portal launches in 2027. Check USDA's OneRD Guarantee page for the current status before planning a B&I closing or servicing request. Banks with B&I projects in the pipeline should also talk with the USDA state office about timing.
This guide is general information for lenders and borrowers, not legal advice. Reading it does not create an attorney-client relationship. SBA, USDA and FSA rules change often, so confirm the current program requirements and the terms of your loan's authorization or commitment before relying on it. Kennedy Sutherland LLP is a private law firm. It is not affiliated with or endorsed by SBA, USDA or FSA.
Sources
- SBA SOP 50 10 8.1, Lender and Development Company Loan Programs (effective Oct. 1, 2026)
- SBA, 7(a) loans
- SBA, 504 loans
- 7 CFR 5001.406, guaranteed loan amounts
- USDA OneRD annual notice of fees and guarantee percentages for FY 2026, 91 FR 11272 (Mar. 9, 2026)
- USDA announcement raising the B&I guarantee to 85% for projects under $5 million (Mar. 27, 2026)
- USDA Rural Development, OneRD Guarantee (forms 5001-1 and 5001-2, notices)
- 7 CFR part 762, Guaranteed Farm Loans (eCFR)
- FSA Handbook 2-FLP (Rev. 1), Amendment 71 (Oct. 1, 2026), FY 2027 loan limits
Sources checked November 2026.