SBA Interest Rates by Lender: What 20,000 Loans Reveal

The Lender You Pick Matters More Than You Think#

Most SBA borrowers focus on interest rates as a single number: "What rate can I get?" But rates on SBA acquisition loans vary far more than most buyers realize - and the variation isn't random.

We analyzed 20,872 variable-rate SBA 7(a) acquisition loans disbursed between 2018 and Q1 2026, sourced through Freedom of Information Act requests to the SBA.¹ Every loan in the dataset is over $500,000, classified as a change-of-ownership transaction, and has a calculable spread over Prime.

The finding that jumped out: among active lenders in any given quarter, median spreads range from near Prime itself to Prime + 2.75%. On a $2 million deal, that range translates to roughly $45,000 per year in interest costs - or $450,000 over a 10-year loan term.

That gap isn't a sign of market inefficiency. It reflects real differences in how lenders operate: their industry focus, their risk appetite, their portfolio strategy, the types of collateral they require. Understanding those differences is the first step to getting a rate that fits your deal.

A note on scope: This article is about interest rates - specifically, spread over Prime - and only interest rates. Choosing a lender involves a lot more than rate: speed to close, industry expertise, how they handle problems mid-process, post-close relationship, and more. A lender offering Prime + 1.00% on the other side of the country with no experience in your industry may not be the right fit, even if their rate looks great on paper. We're isolating one variable here for the sake of analysis, but it's not the only one that matters.

Your Deal Size Sets the Baseline#

Before comparing lenders, you need to know what "competitive" looks like for your specific deal. Loan size is the single strongest predictor of spread in the data.

There's a persistent half-point gap between the smallest and largest tiers. A $750K loan at Prime + 2.25% is right at the median. That same spread on a $4 million deal would put you above the 50th percentile - you should be doing better.

This isn't arbitrary pricing. Larger deals typically involve larger, more established businesses - more cash flow, more collateral, lower risk per dollar lent. Lenders compete harder on deals where the economics justify it. The servicing cost of a $4 million loan isn't much higher than a $700K loan, but the revenue is five times larger. And if most SBA lenders are reselling the guaranteed portion on the secondary market, it's still worth it to them to get the bigger loan at a lower rate.

What this means for you: Don't benchmark your quote against "the market." Benchmark it against your deal size. A Prime + 2.00% offer is mainstream at $800K but unremarkable at $3 million.

Lender Rates Shift - Sometimes Dramatically#

Here's where the data gets interesting for anyone relying on word-of-mouth or a lender's reputation.

We compared each lender's median spread from 2018–2021 against their 2024–2025 median. Among the top 50 lenders by volume (each with at least 10 loans in both periods), the shifts ranged from -1.25 points to +1.00 points.

Some lenders got significantly more competitive:

Others moved the other direction:

And many didn't move at all. Seventeen of the 44 lenders we could track showed zero change in their median spread across the two periods:

The takeaway isn't that shifting is bad or consistency is good. It's that the rate you heard about from another borrower - or even the rate you got quoted two years ago - may not reflect what a lender is offering today. The only way to know is to ask.

Rate Is a Strategy - Not Just a Number#

The table above raises an obvious question: why do lenders price so differently?

Because they're running different businesses.

Take GBank, which tightened from Prime + 1.75% to Prime + 1.00% - one of the most aggressive moves in the dataset. GBank is the number one nationwide SBA lender for hotels and motels, funding 214 hospitality loans over the past 3 years with an average size of $3.4 million. Hotels involve real estate. Real estate is collateral. Collateral reduces risk. Lower risk enables lower pricing.

Metro City Bank tells a similar story at Prime + 1.25% for nine straight years. Their top three industries? Gas stations, liquor stores, and hotels. All asset-heavy, all with real property. That consistency isn't inertia - it's a pricing model built around a specific risk profile.

Compare that to a lender pricing at Prime + 2.75% on service businesses with no real estate. They're not being greedy. They're pricing a fundamentally different risk: goodwill-heavy businesses where the primary asset walks out the door every night. If the borrower defaults, there's less to recover.

What this means for your deal: Your rate doesn't just reflect your credit score and deal size. It reflects:

• Industry and asset type - Real estate-backed deals (hotels, gas stations, car washes) typically get lower spreads than pure service businesses
• The lender's specialization - A lender with deep experience in your industry can price more aggressively because they understand the risk better
• Portfolio strategy - Some lenders hold loans on their balance sheet and price for long-term yield. Others sell on the secondary market and price for volume
• Their current book - A lender managing portfolio stress from prior years may widen spreads to rebuild margin, regardless of your individual deal quality

None of this is visible in a rate quote. But it explains why the same borrower can get Prime + 1.25% from one lender and Prime + 2.50% from another - and why both quotes might be rational.

When Rates Spiked, Lenders Adjusted#

Between 2022 and 2024, the WSJ Prime Rate jumped from 3.25% to 8.50%. Absolute borrowing costs nearly tripled. You might expect lenders to hold or widen their spreads during that period - adding their margin on top of already-high rates.

The opposite happened, at least partially.

We ran the compression analysis within each loan-size tier to control for the market shifting toward larger deals (which carry lower spreads mechanically). The results:

Four of five tiers compressed. The $3M–$4M tier saw the largest shift at 0.35 points. But the $1M–$2M tier - the biggest single tier by loan volume - was completely flat.

What's behind it? When absolute borrowing costs are high, deal flow gets harder. Fewer deals pencil out at 11% than at 6%. Lenders compete on the lever they control - spread - to keep transactions moving. That competition was strongest on larger deals, where more capital was at stake and the borrower pool was more rate-sensitive.

The flat $1M–$2M tier is the honest caveat. This wasn't universal. If your deal fell in that middle range, the rate environment didn't work in your favor the way it did for larger or smaller transactions.

How to Use This When Shopping for a Loan#

This data points to a few things worth doing:

Know the spread benchmark for your deal size. The table in section two gives you the median and quartile ranges. If your quote falls below the 25th percentile for your size tier, you're getting a competitive rate. If it's above the 75th, ask why - or get another quote.

Get quotes from at least three lenders. The data shows a 2+ point spread across active lenders in any given quarter. Even among lenders with significant volume (50+ loans per year), the range is wide. One conversation isn't enough information.

Ask about their industry experience. A lender with deep experience in your industry can often price more aggressively. GBank doesn't offer Prime + 1.00% because they're charitable - they offer it because they've built underwriting models around hotel cash flows and real estate collateral that let them take less risk per dollar.

Check recent pricing, not reputation. A lender's 2020 word-of-mouth may not match their 2025 pricing. The data shows nearly half the top 50 lenders shifted their spread in one direction or the other. Stability is the exception, not the rule.

Work with a broker who knows the current market. A good SBA loan broker tracks which lenders are competitive in your deal size, industry, and geography right now - not last year.

Methodology#

Based on SBA 7(a) FOIA loan-level data, covering acquisition loans (change of ownership, excluding cancelled) with disbursements from January 2018 through March 2026. Spread calculated as Initial Interest Rate minus WSJ Prime Rate on the first business day of the disbursement month, per SBA SOP 50 10.² Scoped to variable-rate loans over $500K (consistent P+3.0% SBA cap). Credit scores, down payments, and collateral details are not in the FOIA release - we can observe rate outcomes but not borrower-level risk factors. Q1 2026 data is partial.

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Sources#

Footnotes#

1. U.S. Small Business Administration. FOIA loan-level data, requested and obtained under the Freedom of Information Act. Data covers 7(a) program loans with disbursement dates 2018–2026. ↩

2. U.S. Small Business Administration. SOP 50 10 - Lender Development Company Loan Programs. Specifies base rate methodology for 7(a) variable-rate loans. ↩