# How is an SBA 7(a) loan amortized?

**Short answer:** The lender uses a schedule that fits the loan, and the loan must be repaid by maturity. SOP 50 10 8.1, Appendix 18 says fixed-rate payments must fully amortize, and variable-rate loans are typically re-amortized at each rate change.

Canonical page: https://www.sbaexpress.loans/answers/sba-loan-amortization-rules/
Last checked: 2026-11-09

SOP 50 10 8.1, Appendix 18, Amortization (about p. 399) tells the lender to use a schedule appropriate for the type of loan. 13 CFR § 120.214(e) is the underlying rule.

## Fixed and variable rates

- A fixed-rate loan must use a payment that fully amortizes the loan by maturity.
- A variable-rate loan is typically re-amortized at each rate adjustment, so it still pays off by maturity.

## Matching payments to cash flow

Appendix 18 says the schedule may be adjusted to meet the business's cash flow needs. 13 CFR § 120.214(e) allows certain other amortization methods with SBA's prior approval, except balloon payments.

## What a lender cannot charge for

A lender may not charge a fee for changing the installment after a deferment. It also may not charge one to keep the loan on track to pay off by maturity (Section A, Chapter 4, Para. C.2.b, about p. 68).

## Payment order on a sold loan

On a loan sold on the Secondary Market, each payment goes first to accrued interest. It then brings principal current, covers late fees and reduces principal (Section B, Chapter 6, Para. D.2, about p. 209).

## Sources

- [13 CFR § 120.214(e), Amortization](https://www.ecfr.gov/current/title-13/section-120.214)
- [SOP 50 10 8.1, App. 18, Para. A, Amortization (about p. 399)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Sec. A, Ch. 4, Para. C.2.b (about p. 68)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Sec. B, Ch. 6, Para. D.2 (about p. 209)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)