SBA Policy Lets Some Small Businesses Combine Loans Up to $10 Million
A July SBA policy change may let qualifying businesses combine 7(a) and 504 financing, but the 7(a) loan must be approved first and both programs’ rules apply.
A new U.S. Small Business Administration policy may give some qualifying small businesses access to as much as $10 million in combined SBA-backed financing, up from the previous $5 million cumulative limit.
The policy took effect July 4, 2026, and the SBA announced it July 7. Under the new structure, a borrower may obtain up to $5 million through the 7(a) program and up to $5 million through the 504 program. The 7(a) loan must be approved before the 504 financing.
How the combined financing works
The two programs serve different purposes. SBA 7(a) financing is the broader option and can support uses such as working capital, real estate, equipment, debt refinancing and expansion, subject to program and lender requirements.
The 504 program is designed mainly for long-term fixed assets. Eligible uses include buildings, land, facilities, major machinery, equipment and related improvements. A 504 loan generally cannot be used for ordinary payroll, inventory or general working capital.
That division is central to the policy. A business could use 7(a) financing for operating needs or certain expansion costs while using 504 financing for a building, production equipment or another qualifying fixed-asset project. The arrangement remains two separate programs, not one unrestricted $10 million loan.
Who is most likely to benefit
The clearest beneficiaries are established, creditworthy businesses planning capital-intensive projects. That may include manufacturers, logistics companies, construction businesses, energy companies and other operators that need both substantial fixed assets and additional operating capital.
A small retailer, restaurant or service company seeking only a modest working-capital loan may see little direct benefit from the higher combined ceiling. The policy raises potential borrowing capacity, but it does not make a business eligible for financing that does not fit SBA rules.
Approval standards remain in place
Businesses must still meet SBA size, operating and other eligibility requirements, demonstrate creditworthiness and show a reasonable ability to repay. The 7(a) application goes through a participating lender. The 504 portion is arranged through a Certified Development Company, or CDC, working with the lender on the project.
Borrowers also must show that the proposed uses fit the relevant program. Lenders and other financing participants will review the company’s financial condition, repayment prospects and supporting documents.
What business owners should do next
Business owners considering a major purchase or expansion should discuss the full project with an SBA lender or CDC before applying. The order matters: the 7(a) loan must be approved before the 504 financing under the new coordination policy.
The practical question is not simply whether a business can borrow $10 million. It is whether the project can be divided between 7(a)-eligible operating needs and 504-eligible fixed assets while satisfying underwriting requirements for both loans.
The policy may create more room for certain expansion plans, but approval is not automatic and the borrower remains responsible for repayment.
Sources
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