C-Suite Wednesday – Update on the New SOP Release & New FY23 Fees
October 12, 2022
Delaney Sexton
Contributing Editors
C-Suite Wednesday – Update on the New SOP Release & New FY23 Fees
During SBA’s first 7(a) Quarterly Connect Call for the fiscal year 2023, they went over the lending activity numbers for the entirety of fiscal year 2022, the new fees that are effective now, and when the new SOP should be released.
The new SOP 50 10 6.1 is currently in clearance and is expected to be released near the end of October and early November. Once it is published, lenders will have 60 days to learn the material before it becomes effective. Two of the changes noted during the call were that “The Wizard” will be retired and there will be a reduction of documentation requirements.
As of the end of fiscal year 2022, the 7(a) program approved 47,678 loans for almost $25.7 billion. Almost half of the loans (over 22,000) were for loans up to $150,000. The SBA Express program had over 20,000 approved loans for nearly $2 billion. The SBA 504 loan program approved 9,254 loans for about $9.2 billion.
Fees for the 7(a) program in fiscal year 2023 are as follows:
7(a) Lender’s Annual Service Fee
- $500,000 and less: 0.00%
- $500,001 to $5,000,000: 0.55% of the guaranteed portion of the outstanding loan balance.
7(a) Upfront Fees
- $500,000 and less: 0.00%
- $500,001 to $700,000: 0.55% of the guaranteed portion
- $700,001 to $1,000,000: 1.05% of the guaranteed portion
- $1,000,001 to $5,000,000: 3.5% of the guaranteed portion up to $1 million, 3.75% of the guaranteed portion over $1 million
Short Term Loans
- $500,000 or less: 0.00%
- Over $500,000: 0.25% of the guaranteed portion
If the 7(a) loan increases, the annual service fee and the upfront fee will be based on the revised loan amount. If two loans are made within 90 days of each other, the upfront fee will be based on the total of the two loans and will subtract any fees already paid on the first loan.