2nd Quarter Optional Peg Rate, Direct Interest Rate and Maximum Interest Rate of a Third Party Lender Loan for a 504 Project
Summary
SBA Information Notice, control no. 5000-874719, effective December 18, 2025, addressed to SBA employees, 7(a) lenders, Certified Development Companies and Third Party Lenders. It sets the interest rate on Section 7(a) Direct Business Loans at 5.50 percent for the fiscal quarter beginning January 1, 2026, and the Optional Peg Rate for fluctuating rates on guaranty loans at 4.50 percent for the January to March quarter of FY 2026. Under 13 CFR 120.921(b), the maximum rate on a Third Party Lender's commercial loan funding a 504 project stays at 6% over the Prime rate, or the lower rate a State's law permits. The notice carries the signature block of Thomas Kimsey, Associate Administrator, Office of Capital Access, and expires 12/01/26.
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Full text
SBA Information Notice
TO: All SBA Employees,7(a) Lenders, Certified CONTROL NO.: 5000-874719
Development Companies and Third Party Lenders
EFFECTIVE: December 18, 2025
SUBJECT: 2nd Quarter Optional Peg Rate, Direct
Interest Rate and Maximum Interest Rate of a Third
Party Lender Loan for a 504 Project
The purpose of this Notice is to inform SBA employees and Lenders that the interest rate on
Section 7(a) Direct Business Loans is 5.50 percent (5.50%) for the fiscal quarter beginning
January 1, 2026. (Information only – no direct funds available at this time.)
The Optional Peg Rate for fluctuating interest rates on guaranty loans is 4.50 percent (4.50%) for
the January – March quarter of FY 2026.
Pursuant to 13 CFR 120.921(b), the maximum legal interest rate for any Third Party Lender’s
commercial loan which funds any portion of the cost of a 504 project (see 13 CFR 120.801) shall
continue to be 6% over the Prime rate and shall remain in effect until changed. If the
aforementioned Third Party Lender’s commercial loan rate of 6% over the Prime rate exceeds
the maximum legal interest rate permitted by the constitution or laws of a given State, then the
maximum interest rate for the Third Party Loan will be the rate permitted by the constitution or
laws of the given State.
Questions
Questions concerning this Notice may be directed to Darrel Eddingfield at (202) 516-6676 or
darrel.eddingfield@sba.gov.
Thomas Kimsey
Associate Administrator
Office of Capital Access
PAGE 1 of 1 EXPIRES: 12/01/26
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58
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