Commercial Insights

SBA expands loan limits: What the new $10 million cumulative 7A and 504 loan limit means

Key insights

• The SBA has doubled its cumulative 7(a) and 504 loan cap to $10 million for the first time since 2010
• The change allows eligible businesses to combine funding for working capital and long-term investments like real estate and equipment
• Eligibility is limited to businesses using both 7(a) and 504 loan programs in a particular sequence
• Guidance from experienced SBA lenders is critical to navigating program requirements and maximizing access to capital

For small and medium-sized businesses wanting to expand, access to capital remains one of the most important—and often most complex—factors shaping growth. A recent policy shift from the U.S. Small Business Administration (SBA) may offer a new opportunity for certain borrowers, significantly expanding their access to financing.

The SBA has increased the cumulative borrowing limit across its flagship 7(a) and 504 loan programs to $10 million. When structured correctly, qualified borrowers may now access up to $10MM in total SBA financing. This update creates new opportunities to better structure deals and expands total financing available to clients, but it also requires thoughtful coordination upfront.

As Taylor Franco, Head of SBA Large Dollar Originations at Regions Bank, noted, “The SBA is working hard to help growing business gain greater access to working capital through the 7(a) loan programs while simultaneously allowing companies to acquire fixed assets like real estate and/or equipment. It provides certain businesses with the flexibility needed to start, grow and expand.”

For those businesses that qualify, this change can unlock new possibilities for funding both day-to-day operations and long-term investments.

A strategic approach to funding growth

The SBA’s updated policy allows qualified borrowers to combine financing from two of its most widely used programs:

• 7(a) loans, typically used for working capital, expansion, or acquisitions
• 504 loans, typically used for real estate or large equipment purchases

This change allows $5 million through a 7(a) loan and an additional $5 million through a 504 loan, but requires the 7(a) loan to be approved first.

This combined approach is intended to support businesses that need both operating liquidity and capital for fixed assets, especially in select industries.

At a higher level, the policy underscores a broader initiative as policymakers seek ways to provide capital to small businesses at a scale required to compete and grow in today’s economy.

Eligibility is highly specific

While the increased cap is seen as a welcome development, it is not universally available to all borrowers.

To take advantage of the expanded limit, businesses generally must meet specific criteria, including:

• Meet the standard requirements for each SBA program individually
• Have eligible uses that fit within both loan programs
• Structuring the loans in a particular sequence or combination to maximize available limits
• The total amount a borrower can access is influenced by how the loans are structured and timed. In practice, obtaining a 7(a) loan first then adding a 504 project helps preserve the full borrowing capacity available under each program.

Franco emphasized that the opportunity is a step in the right direction for SBA overall and for borrowers who qualify.

“The coordination of the 7(a) and 504 loan limits is a positive step forward for the overall SBA program. While not every borrower will benefit from the expanded cumulative approach, for those who can structure financing in a way that aligns with how the updated limits are applied, it can be a powerful tool.”

Why guidance matters more than ever

With increased flexibility often comes increased complexity—and that is certainly true with these new offerings.

Understanding how to structure SBA financing under the new rules requires careful planning, especially when it comes to sequencing loans and aligning them with business objectives. This is where an experienced SBA lender becomes essential.

Franco underscored this point, stating “Because of the specifics of the policy and new expansion, it’s important to check with your SBA lender to see how to structure your business and lending now and in the future to secure the most optimal funding available .”

Regions Bank is at the forefront of helping businesses navigate these nuances. With deep experience in SBA lending, Regions teams work closely with clients to evaluate eligibility, structure financing strategies, and align funding with long-term growth goals.

From determining whether a combined 7(a)/504 approach makes sense to guiding borrowers through application and approval, Regions provides the insight and hands-on support businesses need to make informed decisions.

A step forward for business growth

The SBA’s decision to raise the cumulative loan cap marks an important step toward expanding access to capital for growing businesses. While the change may apply to a specific subset of borrowers, it reflects a broader commitment to supporting economic growth and job creation.

For business owners, the takeaway is clear: new opportunities may exist—but unlocking them requires the right strategy and the right guidance.

Ready to help

Whether you’re exploring SBA loans for the first time or looking to expand your current financing strategy, Regions Bank can help you navigate your options. Our experienced bankers understand the complexities of SBA lending and are committed to helping you find solutions tailored to your business goals.

Learn how Regions can support your growth with insights, guidance and customized financing strategies.

Helpful resources:

• SBA Doubles Cumulative 7(a) and 504 Loan Limit to $10 Million
• SBA Policy Notice Clarifying Maximum Loan Limits for 7(a) and 504 - NAGGL
• Policy Notice 5000-879058