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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsMost nonprofits cannot borrow through the SBA’s standard 7(a) or 504 programs because those programs require a for-profit borrower. The narrow exception is SBA Microloans, which may be available to certain not-for-profit childcare centers. Eligibility depends on the borrowing entity, its activities, and the program’s requirements.
Which SBA loan programs can a nonprofit use?
| Program | Rule for nonprofit applicants | What it can finance | Where to apply |
|---|---|---|---|
| 7(a) | The borrower must be an operating business that operates for profit. SBA’s current program page lists a maximum loan amount of up to $5 million; the page does not state a publication year. SBA 7(a) loans | Eligible uses include working capital, real estate, equipment, supplies, and ownership changes. | A participating lender; SBA also offers Lender Match. |
| 504 | The borrower must be an operating, for-profit U.S. business that meets SBA size requirements. The current SBA page lists a maximum of up to $5.5 million; the page does not state a publication year. SBA 504 loans | Major fixed assets such as buildings, land, and long-term machinery. It cannot finance working capital or inventory. | A Certified Development Company (CDC), working with a private lender. |
| Microloan | Certain not-for-profit childcare centers are included; that does not make nonprofits generally eligible. The current SBA page lists loans of up to $50,000; it does not state a publication year. SBA Microloans | Small loans for eligible businesses and qualifying not-for-profit childcare centers. | An SBA-approved intermediary. |
Why 7(a) and 504 usually do not fit a nonprofit
SBA’s 7(a) eligibility requirements include operating for profit, being located in the United States, meeting SBA size standards, and demonstrating creditworthiness and a reasonable ability to repay. Its 504 program likewise requires an operating, for-profit U.S. business that meets size requirements. The 504 program is designed for major fixed assets rather than day-to-day expenses: working capital and inventory are excluded.
SBA states on its 504 page: “Loans cannot be made to businesses engaged in nonprofit, passive, or speculative activities.” A nonprofit’s charitable mission does not override these borrower rules.
The limited exception: Microloans for certain childcare centers
SBA’s Microloan program includes certain not-for-profit childcare centers alongside small businesses. This is a specific exception, not a route for nonprofits generally. The SBA page describes Microloans of up to $50,000 and gives an average loan amount of about $13,000; that average is undated on the page and should not be treated as a current, dated benchmark.
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Microloans are administered through SBA-funded nonprofit community intermediaries. A childcare center applies to an SBA-approved intermediary, which can explain its requirements and assess whether the particular center qualifies.
What if a nonprofit has an affiliated for-profit business?
Do not assume that an affiliated company qualifies—or that it is disqualified—solely because of its connection to a nonprofit. The relevant applicant is the legal entity seeking the loan, and SBA eligibility can depend on its income-generating activity, ownership character, location, size, ability to repay, and business purpose. Public program descriptions do not resolve every affiliation or ownership scenario.
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- Enough forms for 1 year for churches of approximately 150 members
- 5 3/16" x 9"
- Includes forms for church receipts, member contributions, and disbursements
- Identify the exact legal entity that would sign for and repay the loan.
- Describe which entity earns the income and carries out the activity the loan would support.
- For a possible Microloan, establish whether the applicant is a qualifying not-for-profit childcare center.
- Match the planned spending to the program’s permitted uses, especially the 504 fixed-asset restriction.
Ask the lender, CDC, or Microloan intermediary to review the exact structure under current SBA requirements rather than relying on the nonprofit’s mission or affiliation as a proxy for eligibility.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to find the right application channel
- For 7(a): Contact a participating SBA lender or use SBA’s Lender Match. The lender provides the requirements for the specific loan.
- For 504: Contact a Certified Development Company, which works with a private lender to deliver the financing.
- For a qualifying childcare center seeking a Microloan: Contact an SBA-approved Microloan intermediary and ask it to assess the applicant’s status and proposed use of funds.
Overall eligibility is case-specific. SBA identifies factors such as income-generating activity, ownership, location, size, repayment ability, and sound business purpose; the relevant lender or intermediary can explain the requirements that apply to the application.
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