Print this page

Wells Fargo® SBA 7(a) Term Loan — Frequently Asked Questions

Application Questions

Account Pricing Questions

Account Usage Questions


Application Questions

1. How do I apply for a SBA 7(a) loan?
Back to Top
2. Do I need to be a Wells Fargo customer to apply for a SBA 7(a) loan?
No, you do not need to be a Wells Fargo customer to apply for a SBA 7(a) loan.Back to Top
3. How do I know if my business is eligible for a SBA loan?
  • Existing and on-going for-profit businesses.
  • A business cannot have a tangible net worth that exceeds $15 million and have an average net income greater than $5 million over the past two years.
Back to Top
4. How does the financing work?
Wells Fargo will provide the financing for your 7(a) loan and the SBA will provide an 85% guarantee to Wells Fargo on loans of $ 150,000 or less; or a 75% guarantee on loans from $150,001 to $5 million.Back to Top
5. Is collateral required for a SBA 7(a) loan?
Yes, Wells Fargo will take a secured interest business assets and/or a mortgage on real estate.Back to Top
6. What happens after I apply?
The loan application will go to a specialized credit team to determine if you qualify under Wells Fargo credit standards, as well as, SBA eligibility guidelines.Back to Top
7. How quickly can I get my SBA 7(a) account?
It depends on your planned use of loan proceeds and the program used. Wells Fargo will process your application as quickly as possible. Wells Fargo is a Preferred Lender in many states, which means quicker approval time for you.Back to Top

Account Pricing Questions

8. What will be the maximum interest rate (APR) on my account?
  • Your rate can be either fixed or variable and will be determined based on a business and personal credit evaluation.
  • For terms less than 7 years, the rate can be up to Wall Street Journal Prime + 2.25% and for terms greater than 7 years, the rate can be up to Wall Street Journal Prime + 2.75%.
Back to Top
9. What is my minimum payment?
Your minimum payment for a term loan will be principal and the interest accrued in a given month of activity plus any past due amount.Back to Top

Account Usage Questions

10. How can I use my SBA 7(a) account?
The proceeds of a SBA 7(a) loan can be used for most business purposes. These may include buying real estate, construction, renovation or leasehold improvements; buying furniture, fixtures, machinery, and equipment; buying inventory; and working capital.

The proceeds of a SBA loan cannot be used to:
  • Buy real estate if you have issued a forward commitment to the builder/developer, or where the real estate will be held primarily for investment purposes.
  • Make payments to other owners or pay delinquent withholding taxes.
  • Pay existing debt, unless it can be shown that the refinancing will benefit the small business and that the need to refinance is not indicative of imprudent management. (Proceeds can never be used to reduce your exposure in the loans being refinanced.)
Back to Top