Which SBA programs cannot refinance debt?
Short answer
Microloans cannot pay existing debts. Contract, Seasonal and Builders CAPLines cannot refinance existing debt; Working Capital CAPLines may refinance only short-term revolving debt. Manufacturers' Access to Revolving Credit (MARC) loans may refinance only debt originally used for working capital (sba.gov/loans/microloans; SOP 50 10 8.1, App. 14, Para. B).
Microloans, and Contract, Seasonal and Builders CAPLines, cannot refinance debt at all. Several other programs can refinance only certain debt.
Programs that cannot
- Microloans. SBA's microloan page says proceeds cannot be used to pay existing debts or to purchase real estate. 13 CFR 120.707(a) limits them to working capital and the purchase of materials, supplies, furniture, fixtures and equipment.
- Contract, Seasonal and Builders CAPLines. Appendix 14, Paragraph B.5 of SOP 50 10 8.1 says proceeds are not eligible for refinancing existing debt.
Programs with limits
- Working Capital CAPLines may refinance only short-term revolving debt. That debt must be terminated after payoff (App. 14, Para. B.4).
- MARC loans may refinance only debt originally used for working capital (Para. B.3).
- Export Working Capital Program (EWCP) loans must terminate the refinanced loan, and its collateral must be transferred to the EWCP loan (Para. B.7).
- 504 loans follow 13 CFR 120.882, with separate rules for refinancing with and without expansion.
Programs under the general rules
Standard 7(a), 7(a) Small, SBA Express, Export Express and International Trade loans follow Appendix 14's general requirements. Export Express also limits refinancing of existing SBA-guaranteed loans (Sec. B, Ch. 5, Para. A.1.c).
On any 7(a) program, working capitalMoney for day-to-day costs such as payroll, rent and inventory. Full definition proceeds cannot refinance debt, even where refinancing is a separate eligible use (Sec. A, Ch. 3, Para. A.2.d.iii).
Sources
- sba.gov/loans/microloans, read November 8, 2026
- 13 CFR § 120.707
- SOP 50 10 8.1, App. 14, Para. B, Program-Specific Requirements, Paras. B.3-B.8 (p. 358)
- 13 CFR § 120.882
- SOP 50 10 8.1, Sec. B, Ch. 5, Para. A.1.c, Export Express (Para. A begins p. 168)
- SOP 50 10 8.1, Sec. A, Ch. 3, Para. A, Eligible Uses of Proceeds, Para. A.2.d.iii (p. 51)
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