Big News from the SBA — Effective July 4, 2026
The U.S. Small Business Administration just made a significant change to how the SBA 7(a) and SBA 504 loan programs work together. If you have or are considering either type of loan, this is worth understanding.
The short version: Ohio small businesses can now access more SBA-backed financing than ever before. Here’s what changed and what it means for you.
What Changed
Until now, the SBA capped the total amount a business could borrow across both the 7(a) and 504 programs combined at $5 million. That meant if you had a $3 million 7(a) loan, you could only access $2 million through a 504 loan. The two programs were tied together.
Effective July 4, 2026, that combined cap doubles to $10 million. Eligible businesses can now access up to $5 million through each program at the same time — the highest combined SBA-backed financing cap in agency history.
The two programs are now decoupled. Your 7(a) loan no longer reduces what you can access through the 504, and vice versa — with one important exception to understand.
The One Thing to Get Right: Sequencing Matters
Here is the key detail that every Ohio business owner and banker needs to know.
Existing 7(a) loans generally do NOT reduce a borrower’s maximum SBA 504 debenture. However, 504 loans DO count against 7(a) capacity. That means the order in which you take out these loans matters.
Get a 7(a) first, then a 504, and you can maximize both. Go the other way, and your 7(a) capacity shrinks. If you are planning to use both programs, talk to your lender and OSDC before you structure the deal.
What This Means in Practice
This is where it gets useful for Ohio small businesses. Here is how the new structure can work for you:
You can now pair a 7(a) loan with a 504 loan to expand your total SBA-backed capital well beyond what was previously possible.
Use your 7(a) for things like working capital, goodwill in a business acquisition, inventory, or other operational needs. Use the 504 for what it does best: buying the building where your business operates or purchasing major equipment with a low fixed rate that never changes.
For manufacturers and eligible energy businesses, the upside is even bigger. Qualified manufacturers can now finance a facility through the 504 and a separate production line as concurrent 504 projects, with loan amounts up to $5.5 million per 504 debenture.
A Real-World Example
Imagine an Ohio manufacturer that wants to buy a building and also needs capital for equipment and working capital as part of the same growth plan. Under the old rules, they were capped at $5 million total across both programs. Under the new rules, they can structure a $5 million 504 loan for the building and a separate $5 million 7(a) loan for the equipment and working capital — a $10 million financing stack that keeps the entire deal within SBA channels.
That kind of flexibility opens doors that weren’t open before.
What OSDC Does in This Structure
OSDC handles the 504 side of the equation. We work alongside your bank, which handles the 7(a) or conventional financing, to structure the deal so both pieces work together. We’ve been doing this for Ohio small businesses for years, and these new rules give us more tools to work with.
If growth is part of your plan, don’t sit on the sidelines. With these new financing options becoming available July 4, 2026 now is the time to explore what’s possible. Contact OSDC today to discuss your project and learn how these changes could help you secure the financing you need to move forward.