What Contractors Need to Know About the SBA 7(a) Loan Program

If you have ever been turned down for conventional financing or found that traditional lending did not quite fit what your business needed, the SBA 7(a) Loan Program may be worth a closer look.

AC Surety sat down with Capital Bank to get a plain-language explanation of how the program works and who it is built for.

What It Covers

The 7(a) is the SBA's flagship lending program and one of the most flexible financing tools available to contractors. It covers business acquisitions, expansions, real estate, working capital, and partner buyouts. If you can think of a legitimate business financing need, there is a good chance the 7(a) has a path to address it.

How It Works

As a borrower, you work directly with the bank. The SBA operates in the background, guaranteeing up to 75% of the loan on a typical deal. You never deal with the SBA directly. That guarantee gives lenders the confidence to extend capital to businesses that might not qualify through conventional channels alone.

Why It Matters for Contractors

For contractors looking to acquire a business, buy out a partner, purchase real estate, or shore up working capital, the 7(a) can open doors that conventional lending cannot.

This is the first in a new series where AC Surety sits down with trusted professionals from banking, law, and accounting to answer the questions contractors are actually asking.