You’re sitting at the closing table, flipping through your SBA loan documents, when you spot a line item you weren’t expecting: “Guarantee Fee — $6,750.” SBA guarantee fees are one of the most common closing-day surprises for first-time borrowers — and nobody warned you about this one. Is it normal? Did your lender add something extra? Did they calculate it correctly?
The short answer: it’s completely normal, and it’s a standard part of most SBA 7(a) loans. This article breaks down exactly what the fee is, how it’s calculated, the current rate tiers by loan size, and which borrowers may qualify for a waiver — so you’re never caught off guard at closing.
What Is an SBA Guarantee Fee?
When the SBA backs a loan, it’s agreeing to cover a portion of what the lender loses if you default. That guarantee is what makes SBA loans possible — lenders take on less risk, so they’re willing to approve businesses that wouldn’t qualify for a conventional loan.
The guarantee fee compensates the SBA for taking on that risk. Think of it as a one-time insurance premium charged at closing. It’s not an origination fee from your lender — it goes to the federal program that makes SBA lending work.
Technically, the fee is charged to the lender. But in practice, lenders almost always pass it through to the borrower. The good news: you’re usually allowed to roll it into your loan amount, so you don’t have to write a check out of pocket at closing.
Key Fact
The SBA guarantee fee applies primarily to 7(a) loans, including SBA Express. The SBA 504 program has a separate fee structure built into the CDC portion of the loan. If you’re not sure which loan type you have, ask your lender directly.
How SBA Guarantee Fees Are Calculated
The fee isn’t calculated on your total loan amount. It’s calculated on the guaranteed portion of your loan — which depends on loan size:
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Loans at or below $150,000: SBA guarantees up to 85% of the loan -
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Loans above $150,000: SBA guarantees up to 75% of the loan
The fee rate then depends on the size of that guaranteed amount and your loan’s maturity (whether it’s 12 months or less, or longer). Here’s a concrete example:
Say you borrow $300,000 with a 10-year term. The SBA guarantees 75% of that, or $225,000. At the current rate of 3.0% for loans in this tier, your guarantee fee would be $225,000 × 3.0% = $6,750. That’s the line item you’d see at closing.
Check your numbers before signing. Understanding the math helps you confirm that what appears on your closing statement is accurate — and gives you a realistic picture of your total loan cost. For a full view of what to expect at the closing table, see our guide on SBA loan closing costs.
The Current SBA Guarantee Fee Schedule
The SBA sets guarantee fee rates annually through the appropriations process. The table below reflects the current 7(a) fee schedule. Always confirm the exact rates with your lender or at SBA.gov before closing.
| Loan Amount | Maturity | Fee Rate | Applied To |
|---|---|---|---|
| $0 – $150,000 | Any | 0% (waived) | Guaranteed portion |
| $150,001 – $700,000 | > 12 months | 3.0% | Guaranteed portion |
| $700,001 – $5,000,000 | > 12 months | 3.5% | Guaranteed portion |
| Any amount | ≤ 12 months | 0.25% | Guaranteed portion |
Fee Waivers and Exceptions — Who Pays Nothing
Not every borrower pays the guarantee fee. Several categories of borrowers may qualify for a full or partial waiver:
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Veterans (SBA Veterans Advantage): The SBA waives the upfront guarantee fee for veterans on 7(a) loans up to $350,000. This applies to loans under the Veterans Advantage program and is one of the most reliable ongoing waivers. -
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Loans at or below $150,000: The SBA has consistently waived guarantee fees on smaller loans in recent fiscal years. If your loan is at or under this threshold, expect no guarantee fee. -
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Short-term loans (≤12 months): All loan sizes receive a significantly reduced rate of just 0.25% — including SBA Express working capital lines of credit with short maturities. -
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Annual ongoing fee: Separate from the upfront guarantee fee, lenders also pay a small annual servicing fee (currently 0.55% of the outstanding guaranteed balance) to the SBA each year. This may or may not be passed through to you — ask your lender.
Watch Out
SBA guarantee fee rates and waiver programs are set annually through the federal appropriations process. What’s waived this year may not be waived next year. Always verify the current fee schedule with your lender or at SBA.gov before you finalize your application. Don’t rely solely on information from older blog posts or documents.
It’s also worth understanding what the fee doesn’t cover. The guarantee fee is not the same as a personal guarantee — that’s a separate obligation. The guarantee fee is what the federal program collects; the personal guarantee is your individual promise to repay.
How the Fee Appears in Your Closing Costs
Knowing the fee is one thing — knowing what to do with it at closing is another. Here’s how it typically plays out:
Understand the Fee Amount
Your lender will disclose the guarantee fee in your Loan Authorization document before closing. Use the table above to verify the math — guaranteed portion × fee rate = your fee.
Decide Whether to Roll It In
Most borrowers finance the fee into the loan amount. On a $300,000 loan with a $6,750 fee, you’d borrow $306,750. This avoids any out-of-pocket payment but does slightly increase your monthly payment and total interest over time. See how that plays out in your amortization schedule.
Confirm at Closing
Review your Settlement Statement line by line. The guarantee fee should appear as a clearly labeled charge. If the number doesn’t match what was disclosed earlier — or what you calculate using the rate table — ask for an explanation before signing.
Know Before You Sign
SBA guarantee fees are a standard part of the loan — not a red flag and not a lender add-on. For most borrowers taking out a loan between $150,000 and $5 million, the fee will range from about 3.0% to 3.5% of the guaranteed portion. That’s a predictable cost you can calculate before you ever sit down to close.
Use the fee tiers above to estimate your cost early in the process. Check whether your veteran status or loan size qualifies you for a waiver. And always verify the current rates — SBA guarantee fees can shift with the federal budget each fiscal year. Going into closing informed means no surprises.
Get a Clear Picture of Your Total Loan Cost
Our SBA lending experts walk you through every fee — including guarantee fees — before you apply. No surprises, no fine print you didn’t see coming.
