SBA Loans in Michigan: Your Complete Guide to 7(a), 504, and Express Financing
If you're a Michigan business owner looking to expand, purchase commercial real estate, acquire equipment, or buy an existing business, SBA loans offer some of the most competitive rates and favorable terms available. But navigating the Small Business Administration loan process can feel overwhelming—especially if you're doing it for the first time.
At LVRG Business Funding, we've facilitated hundreds of SBA loans for Michigan businesses over the past 20 years. From Detroit to Grand Rapids, Ann Arbor to Lansing, we've helped established companies across the state access SBA 7(a), SBA 504, and SBA Express financing to fuel growth and achieve their strategic objectives.
This comprehensive guide covers everything Michigan business owners need to know about SBA loans—including program details, qualification requirements, approval timelines, and how to choose the right SBA loan for your business.
What Are SBA Loans?
SBA loans are government-backed financing programs administered by the U.S. Small Business Administration. The SBA doesn't lend money directly to businesses. Instead, it guarantees a portion of loans made by approved lenders—typically banks and credit unions—which reduces lender risk and enables them to offer more favorable terms than conventional business loans.
For Michigan business owners, SBA loans provide:
Lower interest rates than traditional bank loans
Longer repayment terms (up to 25 years for real estate)
Higher loan amounts (up to $5 million for 7(a), $5.5 million for 504)
Lower down payments (typically 10% vs. 20-30% for conventional loans)
Flexible use of funds for expansion, equipment, real estate, and acquisitions
Types of SBA Loans Available in Michigan
SBA 7(a) Loans: The Most Versatile SBA Program
What It Is:
The SBA 7(a) loan program is the most popular and flexible SBA financing option. It can be used for nearly any legitimate business purpose.
Loan Amounts:
Maximum: $5,000,000
Typical range: $500,000 to $5,000,000
Average loan size: $500,000 to $2,000,000
Use Cases:
Working capital and cash flow
Business acquisitions and buyouts
Equipment purchases
Commercial real estate (owner-occupied)
Refinancing existing debt
Expansion and growth capital
Partner buyouts
Interest Rates:
SBA 7(a) loans typically feature rates tied to the Prime Rate:
Prime Rate + 2.25% to 2.75% for loans over $50,000
Fixed or variable rate options available
As of 2025, typical rates range from 8% to 11%
Repayment Terms:
Real estate: Up to 25 years
Equipment: Up to 10 years
Working capital: Up to 10 years
Down Payment:
Typically 10% for existing businesses with strong financials
Approval Timeline:
60 to 90 days from application to funding
Best For:
Michigan businesses seeking flexible financing for multiple purposes, business acquisitions, or expansion projects requiring $500K to $5M.
Availability in Michigan:
LVRG facilitates SBA 7(a) loans for businesses throughout Michigan, including Detroit SBA loans, Grand Rapids SBA financing, Ann Arbor business acquisitions, and companies across Metro Detroit, Oakland County, Macomb County, Wayne County, Kent County, and statewide.
For more detailed information about SBA 7(a) loans, visit our dedicated SBA resource: SBALoansMichigan.com - SBA 7(a) Loans
SBA 504 Loans: Commercial Real Estate & Major Equipment
What It Is:
The SBA 504 loan program is specifically designed for purchasing owner-occupied commercial real estate and major fixed assets. It's structured as two separate loans: 50% from a conventional lender, 40% from a Certified Development Company (CDC), and 10% down payment from the borrower.
Loan Amounts:
Maximum: $5,500,000 (standard)
Maximum: $5,500,000 to $16,500,000 (for manufacturing or energy efficiency projects)
Typical range: $500,000 to $10,000,000
Use Cases:
Purchasing commercial real estate for business operations
Constructing new facilities
Major equipment purchases (machinery with useful life of 10+ years)
Modernizing or renovating facilities
Refinancing existing commercial mortgages (limited circumstances)
Interest Rates:
SBA 504 loans offer some of the lowest rates available:
CDC portion: Fixed rate, typically 5% to 7%
Bank portion: Varies, typically Prime + 1% to 2.5%
Overall effective rate: 6% to 8% (blended)
Repayment Terms:
20 years (standard real estate and equipment)
25 years (specific projects meeting job creation criteria)
Down Payment:
10% for existing businesses
15% for new businesses (less than 2 years old)
15% for special purpose properties
Approval Timeline:
60 to 120 days from application to funding
Best For:
Michigan businesses purchasing commercial property or investing in major equipment with long useful lives. Ideal when you want the lowest possible rates and longest terms.
Availability in Michigan:
LVRG facilitates SBA 504 loans for Michigan businesses purchasing commercial real estate in Detroit, Grand Rapids, Ann Arbor, Lansing, Flint, and throughout Oakland County, Macomb County, Wayne County, Kent County, and statewide.
For more detailed information about SBA 504 loans, visit our dedicated SBA resource: SBALoansMichigan.com - SBA 504 Loans
SBA Express Loans: Faster SBA Financing
What It Is:
SBA Express is a streamlined version of the 7(a) program that offers faster approval and funding in exchange for lower maximum loan amounts.
Loan Amounts:
Maximum: $500,000 (increased from $350,000 in recent years)
Typical range: $50,000 to $500,000
Use Cases:
Working capital
Equipment purchases
Inventory
Business expansion
Debt refinancing
Interest Rates:
Similar to SBA 7(a): Prime + 4.5% to 6.5%
Typically 9% to 12%
Repayment Terms:
Up to 10 years for working capital and equipment
Up to 25 years for real estate
Down Payment:
Typically 10% to 20% depending on use of funds
Approval Timeline:
Approximately 2 weeks from application to funding (significantly faster than traditional SBA 7(a))
Best For:
Michigan businesses that need SBA-quality rates and terms but require faster funding and don't need more than $500,000.
Availability in Michigan:
LVRG facilitates SBA Express loans for businesses throughout Michigan needing expedited SBA financing in Detroit, Grand Rapids, Ann Arbor, Lansing, and across the state.
SBA Loan Requirements for Michigan Businesses
To qualify for SBA financing in Michigan, businesses must meet both SBA-mandated requirements and individual lender criteria.
Basic SBA Eligibility Requirements:
Business Type: ✓ For-profit business
✓ Operates in the United States
✓ Meets SBA size standards (typically under 500 employees for most industries)
✓ Not engaged in prohibited activities (speculation, lending, passive investment)
Operating History: ✓ At least 2 years in business (preferred)
✓ Startups may qualify with strong personal credit and industry experience
Credit Requirements: ✓ Personal credit score: 680+ (minimum)
✓ Business credit: Established and positive payment history
✓ No recent bankruptcies or major delinquencies
Financial Requirements: ✓ Positive cash flow demonstrated
✓ Ability to service debt based on financial projections
✓ Reasonable debt-to-income ratios
✓ Sufficient collateral (real estate, equipment, business assets)
Owner Requirements: ✓ Owners with 20%+ equity must personally guarantee the loan
✓ Good character, management experience, and industry knowledge
✓ Sufficient personal liquidity for down payment and working capital
Specific Requirements by Loan Type:
SBA 7(a):
2+ years operating history strongly preferred
Strong personal credit (680+)
10% down payment (existing businesses)
Collateral coverage for loan amount
SBA 504:
2+ years operating history required
Purchasing owner-occupied commercial real estate or major equipment
Business must occupy at least 51% of the property
Job creation or retention goals (typically 1 job per $65,000 of SBA funding)
SBA Express:
Similar to 7(a) but more flexible on some criteria
Faster documentation requirements
May accept slightly lower credit scores depending on overall strength
The SBA Loan Application Process in Michigan
Step 1: Determine Your Financing Needs
Before applying for an SBA loan in Michigan, clarify:
How much capital do you need? ($500K, $2M, $5M?)
What will you use it for? (Real estate, equipment, acquisition, working capital?)
What's your timeline? (Can you wait 60-90 days or do you need faster funding?)
What's your business profile? (Revenue, profitability, credit strength?)
Step 2: Choose the Right SBA Program
Based on your needs:
Buying commercial real estate or major equipment? → SBA 504
Acquiring a business or need flexibility? → SBA 7(a)
Need $500K or less with faster approval? → SBA Express
Step 3: Prepare Your Documentation
SBA lenders require comprehensive documentation:
Personal Documents:
Personal financial statement
Personal tax returns (3 years)
Resume demonstrating industry experience
Credit authorization forms
Business Documents:
Business tax returns (3 years)
Year-to-date financial statements (P&L, balance sheet)
Business plan or expansion plan
Legal documents (articles of incorporation, operating agreement)
Business licenses and registrations
Transaction-Specific Documents:
Real estate: Purchase agreement, appraisal, environmental report
Equipment: Quotes, specifications, useful life documentation
Acquisition: Purchase agreement, seller financials, valuation
Step 4: Work with an Experienced SBA Lender
Not all lenders are created equal when it comes to SBA loans. Working with an experienced SBA lender like LVRG Business Funding ensures:
✓ Faster processing (we know exactly what underwriters need)
✓ Higher approval rates (we structure deals properly from the start)
✓ Better terms (we leverage relationships with multiple SBA-approved lenders)
✓ Expert guidance (we've closed hundreds of SBA deals for Michigan businesses)
Step 5: Underwriting and Approval
Once your application is submitted:
Lender reviews and underwrites the deal (2-4 weeks)
SBA reviews and issues approval (2-4 weeks)
Final documentation and closing (1-2 weeks)
Total Timeline:
SBA 7(a) and 504: 60 to 90 days
SBA Express: 10 to 14 days
Step 6: Closing and Funding
At closing, you'll:
Sign loan documents
Provide down payment funds
Complete any final conditions
Receive loan proceeds
SBA Loans vs. Conventional Business Loans: What's Better for Michigan Businesses?
INTEREST RATES:
SBA Loans: 6% to 11%
Conventional Loans: 8% to 15%
DOWN PAYMENT:
SBA Loans: 10% to 15%
Conventional Loans: 20% to 30%
LOAN TERMS:
SBA Loans: Up to 25 years
Conventional Loans: 5 to 15 years
APPROVAL TIMELINE:
SBA Loans: 60 to 90 days
Conventional Loans: 30 to 60 days
MAXIMUM AMOUNT:
SBA Loans: $5M to $5.5M
Conventional Loans: Varies widely
FLEXIBILITY:
SBA Loans: High (7a), Limited (504)
Conventional Loans: Varies by lender
CREDIT REQUIREMENTS:
SBA Loans: 680+ preferred
Conventional Loans: 700+ typically
USE RESTRICTIONS:
SBA Loans: Some limitations
Conventional Loans: Fewer limitations
When to Choose SBA: ✓ You want the lowest possible rates
✓ You need longer repayment terms
✓ You're purchasing commercial real estate
✓ You're acquiring an existing business
✓ You have time for 60-90 day approval process
When to Choose Conventional: ✓ You need funding in 30 days or less
✓ You have strong credit and financials (can get competitive rates)
✓ Your use of funds doesn't fit SBA guidelines
✓ You need maximum flexibility
Common SBA Loan Mistakes Michigan Business Owners Make
Mistake #1: Applying Without Adequate Preparation
The Problem: Incomplete applications cause delays and denials.
The Solution: Gather all documentation before starting the application.
Mistake #2: Underestimating Timeline
The Problem: Expecting funding in 30 days when it takes 60-90.
The Solution: Plan ahead. Start the SBA process 3-4 months before you need funds.
Mistake #3: Not Shopping Lenders
The Problem: Each SBA lender has different underwriting standards and timelines.
The Solution: Work with an experienced intermediary like LVRG who has relationships with multiple SBA lenders.
Mistake #4: Poor Credit Management During Process
The Problem: Applying for new credit cards or making large purchases while application is pending.
The Solution: Freeze all major financial changes until after closing.
Mistake #5: Inadequate Collateral Documentation
The Problem: Failing to properly value and document collateral.
The Solution: Get professional appraisals and organize ownership documentation early.
Why Michigan Businesses Choose LVRG for SBA Loans
20+ Years of SBA Loan Experience
We've facilitated SBA financing for Michigan businesses since 2003. We know the programs inside and out, and we've built relationships with the state's most active and efficient SBA lenders.
Institutional Banking Partnerships
We work with multiple SBA-approved lenders across Michigan and nationwide. This means:
We can shop your deal to find the best fit
We know which lenders approve which deal types fastest
We leverage competition to get you better terms
White-Glove Service Throughout the Process
SBA loans involve complex documentation and multiple stakeholders (you, the lender, the SBA, attorneys, appraisers, etc.). We manage the entire process:
One point of contact from application to funding
Proactive communication at every stage
Expert guidance on structuring and documentation
Fast response times to keep deals moving
Michigan Expertise
We understand Michigan industries, Michigan real estate markets, and Michigan business challenges. Whether you're:
A Detroit manufacturer expanding production capacity
A Grand Rapids healthcare practice purchasing a medical building
An Ann Arbor tech company acquiring a competitor
A Lansing contractor buying heavy equipment
We've closed deals like yours before.
SBA Loan Success Stories: Michigan Businesses We've Helped
Manufacturing Expansion in Metro Detroit
Loan Type: SBA 504
Amount: $3,200,000
Use: Purchase of 45,000 sq ft manufacturing facility in Macomb County
Result: Company doubled production capacity and added 18 jobs
Restaurant Acquisition in Grand Rapids
Loan Type: SBA 7(a)
Amount: $875,000
Use: Acquisition of established restaurant with real estate
Result: Seamless ownership transition, business continues thriving under new ownership
Medical Equipment Purchase in Ann Arbor
Loan Type: SBA 504
Amount: $1,800,000
Use: Advanced diagnostic imaging equipment
Result: Practice expanded service offerings and patient capacity
Construction Equipment in Lansing
Loan Type: SBA Express
Amount: $425,000
Use: Excavation equipment purchase
Result: Fast 2-week approval enabled company to secure major contract
Geographic Coverage: SBA Loans Across Michigan
LVRG facilitates SBA loans for established businesses throughout Michigan:
Metro Detroit & Surrounding Areas
Detroit SBA loans: Manufacturing, healthcare, technology, and service businesses
Oakland County: Troy, Southfield, Farmington Hills, Novi, Birmingham
Macomb County: Sterling Heights, Warren, Clinton Township, Shelby Township
Wayne County: Dearborn, Livonia, Westland, Canton, Taylor
West Michigan
Grand Rapids SBA loans: Kent County's largest city and economic hub
Holland, Grand Haven, Muskegon: Lakeshore manufacturing and tourism businesses
Mid-Michigan
Lansing SBA financing: State capital and government contractor hub
Flint and Genesee County: Manufacturing and automotive supplier businesses
Southeast Michigan
Ann Arbor SBA loans: Washtenaw County tech, healthcare, and university-adjacent businesses
Jackson, Brighton, Howell: Growing communities with diverse business needs
Statewide Coverage
Kalamazoo, Battle Creek, Portage: Southwest Michigan businesses
Traverse City and Northern Michigan: Tourism, agriculture, and retail
Saginaw, Bay City, Midland: Great Lakes Bay Region manufacturers
Upper Peninsula: Mining, tourism, and forestry businesses
No matter where your Michigan business is located, LVRG can facilitate SBA financing.
Frequently Asked Questions About SBA Loans in Michigan
Q: How long does it take to get approved for an SBA loan in Michigan?
A: SBA 7(a) and 504 loans typically take 60 to 90 days from application to funding. SBA Express loans can fund in approximately 2 weeks.
Q: What credit score do I need for an SBA loan?
A: Most SBA lenders require a minimum personal credit score of 680, with 700+ preferred for larger loans. Strong business financials can sometimes compensate for slightly lower credit scores.
Q: Can startups get SBA loans?
A: It's difficult but not impossible. SBA strongly prefers businesses with 2+ years of operating history. Startups need exceptional credit, substantial industry experience, and significant personal investment.
Q: What can't SBA loans be used for?
A: SBA loans cannot be used for: speculative investments, passive income properties (non-owner-occupied real estate), refinancing existing SBA debt, or businesses engaged in certain restricted activities.
Q: Do I need collateral for an SBA loan?
A: Yes. SBA requires lenders to take collateral to the extent available. For real estate purchases, the property serves as primary collateral. For other uses, business assets and personal guarantees are typically required.
Q: Can I use an SBA loan to buy a franchise in Michigan?
A: Yes. SBA 7(a) loans are commonly used for franchise purchases. The franchise must be on the SBA's approved franchise list.
Q: What's the maximum SBA loan amount in Michigan?
A: SBA 7(a) maximum is $5,000,000. SBA 504 maximum is $5,500,000 (up to $16.5M for manufacturing or energy projects). SBA Express maximum is $500,000.
Q: Can I refinance existing debt with an SBA loan?
A: Yes, under certain circumstances. SBA 7(a) allows refinancing if it provides a substantial benefit (lower rates, better terms, consolidation). SBA 504 refinancing is more limited.
Q: Are there any fees for SBA loans?
A: Yes. SBA charges a guarantee fee (typically 2% to 3.5% of the guaranteed portion). Most lenders roll this into the loan amount rather than requiring upfront payment.
Q: How does LVRG get paid for facilitating SBA loans?
A: We're compensated by the lender upon successful closing. There's no cost to you for our services—we simply ensure your deal is structured properly and approved efficiently.
Ready to Apply for an SBA Loan in Michigan?
If you're an established Michigan business with strong financials and a clear growth plan, SBA financing could be the perfect solution for funding your expansion, equipment purchase, real estate acquisition, or business purchase.
LVRG Business Funding has facilitated hundreds of SBA loans for Michigan businesses over 20+ years. We know the programs, the lenders, and the process inside and out.
For comprehensive SBA loan information, resources, and direct access to Michigan's #1 SBA loan platform, visit: SBALoansMichigan.com
Contact LVRG for SBA Loan Assistance
Headquarters: Downtown Detroit, Michigan
Service Area: Statewide and nationwide
SBA Loan Range: $500,000 to $5,500,000
Apply Online: lvrgfunding.com/apply-now
Call Us: (855) 998-5874
Whether you're in Detroit, Grand Rapids, Ann Arbor, Lansing, or anywhere in Michigan, we're here to help you access SBA financing that fuels your growth.
About LVRG Business Funding
LVRG Business Funding is a Detroit-based boutique lender serving established businesses throughout Michigan and nationwide. For over 20 years, we've deployed more than $1 billion in strategic financing to 10,000+ companies.
We specialize in facilitating SBA 7(a), 504, and Express loans through our institutional banking partnerships. Our clients choose us for expert guidance, efficient processing, and white-glove service from application to funding.
Ready to explore SBA financing for your Michigan business? Apply today or call to speak with an SBA loan specialist.