SBA rules · SOP 50 10 8.1
Can a lender charge a packaging fee on an SBA loan?
Yes, 7(a) lenders and 504 CDCs may charge applicants packaging and preparation fees, subject to specific limits, disclosure rules, and program caps.
Quoted from SBA SOP 50 10 8.1Every quote checked word for word
In detail
- 7(a) packaging fees: A 7(a) lender may charge reasonable fees customary for similar lenders in the geographic area for packaging services, which include assisting with applications, business plans, and cash flow projections.
- 7(a) flat fee and Form 159: Lenders may charge a flat fee of up to $2,500 without documenting the specific service performed, but any fee amount in excess of $2,500 requires documentation and disclosure on SBA Form 159.
- 7(a) percentage caps: When charged as a percentage of the loan amount, the fee cannot exceed what the lender charges on similarly-sized non-SBA commercial loans, or 5% for loans of $150,000 or less and 3% for loans over $150,000 (whichever is less), capped at an aggregate maximum of $30,000.
- 7(a) LSP restrictions: An applicant cannot be charged for the same service by two different entities, and lenders that engage a Lender Service Provider (LSP) cannot pass through any LSP fees to the applicant.
- 504 CDC processing fee: Under the 504 program, a CDC may charge a processing (packaging) fee of up to 1.5% of the Net Debenture proceeds, payable by the borrower.
The source
What the SOP says
“The Lender may charge an applicant reasonable fees (customary for similar Lenders in the geographic area where the loan is being made) for packaging.
“SBA permits the Lender to charge the Applicant a flat fee of up to $2,500 per loan without documenting the service performed.
“the maximum fee that may be charged to an Applicant on a percentage basis is $30,000.
“The Applicant may not be charged for the same service by two different entities, and, if the Lender engages the services of a Lender Service Provider (LSP), it may not pass through to the Applicant any fees charged for work performed by the LSP.
“Up to 1.5% of the Net Debenture
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Related reading
This page quotes the SBA's Standard Operating Procedure 50 10 8.1. Lenders can ask for more than the SBA minimum. It is general information, not a loan approval or legal advice.