Structuring SBA 7(a) BDO Compensation in 2025 — 4/2
Arriving at a Fair Number That Satisfies the Lender, BDO, SBA, Regulators and Shareholders
A Coleman Webinar
Date: Wednesday, April 2, 2025
Time: 2:00 p.m. Eastern
Includes e-certification & recording
This year’s Coleman 2025 SBA 7(a) Business Development Officer compensation survey reviewed over 100 compensation packages and found no two alike.
Compensation for BDOs typically relies on either loan production or a percentage of SBA secondary market premium sale income. The structure of compensation packages varies, consisting of combinations of salary, commissions, and bonuses.
However, established benchmarks exist that lenders and BDOs can use to determine whether a compensation package is fair or imbalanced.
This webinar addresses these issues and assists lenders with the challenge of offering competitive compensation to retain top talent without risking losing employees to rival institutions.
BDO compensation continues to rise, with overall compensation increasing by 4.3% last year. We continue to observe a trend of top producers breaking annual production records. And an anticipated increase in the SBA 7(a) cap will smash previous records.
Many stakeholders have an interest in how to compensate the hunter-gatherers who bring business through the front door of the institution to create solid performing assets.
Lenders face the challenge of structuring compensation packages for top producers that rival the president of the lending institution’s salary.
The most important person in this process is the BDO. They are constantly approached by recruiters and others to bring their services to another institution, promising greener pastures and higher wealth.
The lender must craft a package that keeps the talented BDO happy but is comparable to others within the entire institution.
SBA has an interest in this process. It’s not in the SOP, but they become very nervous when BDO compensation exceeds the President of the United States’ annual salary of $400,000.
Regulators and other entities have concerns about clawbacks.
Ultimately, the compensation package must answer the question, “Is this fair to the shareholders? Are we paying the right amount of compensation for a particular level of loan production?”
This webinar will help you structure SBA BDO 7(a) compensation packages by helping you master the following specific topics:
– Definition of loan volume
– Expected BDO production in below average, average, above average, and top-performing buckets
– Analysis of average base salary, average total compensation, and compensation ranges for each bucket
– The impact of an increased SBA 7(a) loan cap on BDO compensation
– The concept of tiers and increased commissions with increased production
– Analysis of why top-performing BDOs are cheaper to the institution than below-average BDOs
– SBA BDO loan packages tied to secondary market premiums
– SBA BDO compensation packages tied to loan production commissions
– Setting a base salary
– Setting commissions
– The Commission matrix — adjustments up and down
– Paying commissions for 7(a) loans and 504 loans
– Structuring the BDO commission matrix in line with the lender’s credit box
– The BDO vs working with a Loan Broker
– Benchmark studies of loan broker fees
– How to structure paying loan broker fees and BDO commission
– Bonuses and retention bonuses
– Training the BDO
– SBA BDO Self-Reported Challenges for 2025
– Protecting the Institution from a rogue BDO
Your Training Staff
Lance Sexton
A former small business owner, Lance Sexton has a successful history of working with small business owners and students related to entrepreneurship and SBA loan origination, servicing, and liquidation. He has earned three industry training instruction awards for “Best Online Learning Product”. A former SBA Deputy Director of Little Rock Servicing Center, Lance has over 40 years of experience, including 20 years directly managing portfolios of SBA loans. Lance is an adjunct faculty member of University of the Ozarks. He is an Executive Vice President, Managing Director of Servicing and Liquidation at Phoenix Lender Services and has been affiliated with Coleman Publishing for over 10 years.
Bob Coleman
Bob Coleman is the Author of “Money Money Everywhere and Not a Drop for Main Street.” He is the founder of Coleman Publishing, a publisher of newsletters, reports, data, conferences, webinars, online training videos — to help finance professionals become small business lending experts. Bob is the nationally recognized expert on small business financing. He has appeared frequently on Fox Business News, NPR and other numerous media outlets. He is sourced by all print media. He is a frequent speaker about small business lending throughout the US and EU. Bob has a BA in Medieval History from the University of California Santa Barbara and a MBA in Real Estate Finance from the University of Southern California. Bob has earned numerous awards as a producer of events and video training.
His passion is getting capital to Main Street and Rural American small business. Bob’s SBA lending roots trace back to institutions in Southern California, serving as Sr. Vice President and SBA Manager of a community bank and a Chief Operations Officer of a SBLC. He is a founding director of NAGGL.
Coleman Report Webinar Benefits:
- Coleman Report webinars provide solutions to problems that left unaddressed will jeopardize the SBA loan guarantee.
- We give management the tools to create prudent credit boxes compliant with SBA’s standard operating procedures.
- We train your staff to ensure compliance of existing and new SBA rules and regulations.
- Tips that solve difficult SBA underwriting, servicing and liquidation challenges.
How the Webinar Works
We use Microsoft Teams as the webinar platform.
We will open the webinar for attendees to join at 1:30 pm ET. This will give each attendee thirty minutes before the webinar begins to troubleshoot any technical issues. Call (818) 790-4591 if you need assistance.
Recording
All Coleman webinars are recorded and a link is sent to all attendees.
Single Site License
The single site license grants your institution one viewing of the webinar. It is permissible to use a single site license on one device in a conference room to be viewed by multiple attendees The webinar can be viewed on any device.
Multiple Site License
A multiple site license is an unlimited access pass for anyone at your institution. You will be given a link that will be usable to anyone with your email domain.
Webinar Links and Handouts
The webinar link will be included on your sales receipt.
The link will also be included when we send the presentation and handouts. These will be sent by eod the day before.
Participants Earn Certificates of Participation
All Coleman Webinar attendees will receive a certificate of participation. This documents your continuing education history for SBA and your regulators.
Questions
Questions throughout the webinar are strongly encouraged. There are two ways to ask a question. The first is to ask the question via the chat in Microsoft Teams. The second is to send an email to anna@colemanreport.com. Also, feel free to ask pre and post-webinar questions.
The Fine Print
1) Substitutions are allowed at no charge.
2) Cancellations receive a 100% credit for any Coleman product.
3) As with all our products, we offer a 100% money back satisfaction guarantee — no questions asked.
3 Easy Ways to Order
1) ONLINE — Register and pay online via Stripe
2) EMAIL –Send an email to cindy@colemanreport.com with “Webinar Registration” in the Subject Line. We will do all the paperwork and either send you a sales receipt or an invoice.
3) PHONE — Call us at 818-790-4591.
Bob Coleman
Publisher, Coleman Report
bob@colemanreport.com