Quick reminder: Concurrent with SBA’s new fiscal year, SBA Information Notice 5000-180010 announces the 7(a) loan fee schedule, effective October 1, 2018 for Fiscal Year 2019. In a change from the past few years, there is no separate Notice regarding fees on loans made to eligible veteran-owned small businesses. Because the 7(a) program will remain at zero subsidy in fiscal year 2019, the waiver of the upfront guaranty fee on SBA Express loans to qualified veterans will stay in place. A separate Information Notice 5000-180011 covers the 504 loan program. We’re issuing an eBulletin to our 504 lender audience next week.
In brief, for all 7(a) loans approved October 1, 2018 thru September 30, 2019, the annual service (ongoing) fee will be 0.55% or 55 basis points of the guaranteed portion of the outstanding balance. SBA reminds you to manually adjust this fee in the current Authorization Wizard.
The only exception applies to loans made to businesses in eligible rural areas/HUBZones, for which the annual service fee will be zero on loans of $150,000 and less, The Notice defines these zones and details the requirements for documenting an applicant’s eligibility for this fee relief.
For all loans, the upfront guaranty fee will continue to depend on the loan amount and loan maturity.
Bottom line: Obtain as many approvals as possible before October 1!