SBA lenders approved 282 7(a) loans to miscellaneous fabricated metal product manufacturers between October 2023 and June 2026, $222,277,100 from 100 lenders. The median loan was $300,000, double the national $150,300, at a median rate of 9.75%, below the national 10.25%. 21.3% of loans were $1 million or more, and 71 more loans went through SBA 504. Acquisitions were 16.7% of loans, against 10.4% nationally, at a median of $832,000. Lenders weigh equipment and real estate value, customer concentration, and steel-price exposure.
| Measure | All Other Miscellaneous Fabricated Metal Product Manufacturing | All industries |
|---|---|---|
| SBA 7(a) loans approved | 282 | 162,355 |
| Median loan | $300,000 | $150,300 |
| Middle half of loans | $120,000 – $831,500 | $50,000 – $500,000 |
| Loans of $1 million or more | 21.3% | 12.9% |
| Median rate at approval | 9.75% | 10.25% |
| Middle half of rates | 8.5% – 10.5% | 9.3% – 11.25% |
| Acquisitions (change of ownership) | 47 (16.7%) | 16,849 (10.4%) |
| Median acquisition loan | $832,000 | $693,000 |
| Lenders that made these loans | 100 | 1,648 |
| SBA 504 loans (real estate, equipment) | 71 | 16,714 |
Approvals FY2024 – FY2026 to date (1 Oct 2023 – 30 Jun 2026), cancelled loans excluded. Source: SBA 7(a) and 504 FOIA loan records, as of June 30, 2026.
- SBA 7(a) loans approved
- 282 (Oct 2023 – Jun 2026), from 100 lenders
- Median loan
- $300,000 (national $150,300)
- Median rate at approval
- 9.75% (national 10.25%)
- Loans of $1 million or more
- 60 (21.3%)
- Acquisitions
- 47 loans (16.7%), median $832,000 at 9.25%
- SBA 504
- 71 loans, median $793,000
A catch-all code, and loans twice the national size
NAICS 332999 collects the metal products no other manufacturing code names: custom fabrication shops, makers of metal boxes, racks, safes, ladders and fixtures, and companies built around one proprietary product line. What they share, for a lender, is a shop floor of cutting, forming and welding equipment, a workforce of skilled trades, and customers who are usually other businesses.
| Figure | Metal fabricators (332999) | National | Reading |
|---|---|---|---|
| Median loan | $300,000 | $150,300 | Equipment and buildings raise the request |
| Middle half of loans | $120,000 to $831,500 | Few very small loans | |
| 90th percentile | $2,324,610 | One loan in ten is over two million | |
| Loans of $1 million or more | 60 (21.3%) | About one loan in five | |
| Median rate | 9.75% (middle half 8.5% to 10.5%) | 10.25% | Collateral and loan size lower the price |
| Fixed-rate share | 18.8% | Most loans float with the base rate | |
| Acquisitions | 47 (16.7%), median $832,000 at 9.25% | 10.4% of loans | Shops are bought, and not cheaply |
| Start-ups | 5.3% of loans | New shops are rarely SBA-financed | |
| Franchises | None | An owner-built industry | |
| Median jobs supported | 8 | Larger payrolls than most SBA borrowers |
The median rate, 9.75%, is half a point under the national median, and the middle half of rates tops out at 10.5%. Two things are consistent with that. Larger loans fall under tighter SBA caps: above $350,000 a variable 7(a) rate may be no more than the base rate plus 3%, against plus 6% from $50,001 to $250,000. And a lender with appraisable collateral has less to price for. See SBA loan rates.
What a lender can value on the shop floor
Most small businesses borrow against cash flow and a personal guarantee. A metal shop has more to offer, and each kind of asset is valued and financed differently.
| Asset | How a lender values it | How it is usually financed |
|---|---|---|
| Shop building | Appraisal, plus an environmental review | 7(a) real estate up to 25 years, or SBA 504 |
| Lasers, press brakes, CNC and welding equipment | Appraisal at orderly liquidation value | 7(a) up to 10 years, or 15 if useful life supports it; or a separate equipment loan |
| Receivables from business customers | Eligible balances under 90 days | A line of credit; asset-based lenders typically advance 80% to 90% |
| Raw steel and purchased components | Net orderly liquidation value | Up to 85% of that value, or roughly half of cost, in a borrowing base |
| Work in progress and custom parts | Little, since they are built for one customer | Carried by cash flow, not collateral |
Equipment is worth what it would sell for in an orderly sale, not what it cost, and specialized or heavily customized machines appraise lower than standard ones. An equipment appraisal early in the process tells the owner what the lender will credit. See equipment appraisals: OLV and FMV and machinery and equipment in asset-based lending.
Custom work in progress secures little. Equipment, real estate and receivables do the collateral work.
Buildings: 71 SBA 504 loans
Alongside 282 7(a) loans, 71 SBA 504 loans went to these fabricators, at a median of $793,000. That is roughly one 504 loan for every four 7(a) loans, and it fits an industry that needs floor space, crane capacity, power and zoning that permits metalworking. A 504 is typically 50% from a bank, 40% from the CDC and 10% from the borrower, and manufacturers get a larger ceiling on the CDC's share: up to $5.5 million rather than $5 million. The shop must occupy at least 51% of an existing building, or 60% of new construction. Long-life equipment can go into a 504 as well. See SBA 7(a) versus 504.
Metalworking property draws closer environmental attention than an office or a store. Cutting fluids, coatings, finishing and past industrial use all come up in the environmental review, and a problem found there can delay or reshape the loan. An owner who knows the site's history should put it in the file at the start.
What worries a lender in a fabrication business
- Customer concentration. Fabricators often sell to a handful of manufacturers or contractors. A line of credit commonly caps any single customer at 20% to 25% of eligible receivables, and a term lender will ask what happens to cash flow if the largest customer leaves. See customer concentration and debt.
- Steel prices. Material is a large share of cost. Lenders look at whether quotes pass price changes through to customers or lock the shop into a fixed price while steel moves.
- Job shop or product line. A shop quoting custom work competes job by job, so the lender reads its backlog and win history; a company with its own product has repeat demand, so the lender reads reorder patterns and whether the design is protected or easily copied.
- The people. A median of 8 jobs per loan means real payrolls, and skilled welders, programmers and estimators are hard to replace. Where the owner still estimates every job, that is a key-person risk.
- Capital spending. Machines wear out and are replaced. Lenders subtract the spending needed to keep the shop running before they count cash available for debt service. See maintenance capex.
- Certifications. Quality and welding certifications, and any defense or regulated-industry work, are part of what customers buy and what a buyer must keep.
Buying a fabrication shop
47 loans, 16.7% of the total, financed a change of ownership, at a median of $832,000 and a median rate of 9.25%. These are real purchases: the median acquisition loan is nearly three times the industry's overall median. The largest deals run toward the SBA ceiling: 7(a) loans go up to $5 million, and a purchase that needs more debt than that needs a different structure. See acquisitions above the SBA limit.
- Valuation. Where the amount financed, less appraised real estate and equipment, exceeds $250,000, SBA requires an independent valuation, and the purchase loan cannot exceed it. In an equipment-heavy shop, the appraisals reduce the amount the rule applies to.
- Working capital. A buyer of a shop with large receivables and steel on hand needs working capital at close, not just the purchase price. See working capital at close.
- From 1 October 2026, every change of ownership needs financial due diligence and 1.25x coverage on historical results; acquisitions of $3 million or more excluding real estate need a quality of earnings report; and the loan amortizes over no more than 10 years except for the real estate share.
- The seller's knowledge. The seller may consult for up to 12 months, or up to 24 months under SOP 50 10 8.1 from 1 October 2026. In a shop where the owner holds customer relationships and estimating, lenders want that time used deliberately.
See financing a machine shop acquisition and acquisitions that include real estate.
Preparing a fabricator's SBA file
The SBA list comes first: business tax returns for 2–3 years, a P&L and balance sheet with a year-to-date P&L through last month-end, a debt schedule with copies of notes being refinanced, and personal tax returns and a personal financial statement for each owner of 20% or more. A fabricator's file is much stronger with:
- An equipment list with make, model, year and any liens or leases
- An AR aging by customer, with days outstanding, and sales by customer for the last two full years
- Open orders or backlog, with the customers behind them
- An inventory report, if steel and components will support a line of credit
- For real estate, anything known about the site's environmental history
- For a purchase, the letter of intent and the target's latest full year of figures, never an older year
For working capital beside the term loan, see lines of credit for manufacturers. Shops carrying merchant cash advances should read refinancing cash advances for manufacturers first, since SBA will not refinance an active advance. Nearby industries: machine shops, structural metal fabricators and other manufacturers.
Transparent's book holds 278 lenders that write SBA 7(a) and 504, and 244 that write equipment. Once the documents are in, Transparent builds the financing model, lender presentation, blind teaser and underwriting memo in a day.
Common questions
- How large are SBA loans to metal fabricators?
- The median 7(a) loan from October 2023 to June 2026 was $300,000, double the national median, with the middle half between $120,000 and $831,500 and 21.3% of loans at $1 million or more.
- Can a fabrication shop use SBA 504 for its building and equipment?
- Yes. 71 504 loans went to these fabricators, at a median of $793,000. For manufacturers the CDC's share goes up to $5.5 million, and the shop must occupy at least 51% of an existing building.
- Does shop equipment count as collateral for an SBA loan?
- Yes, at its appraised liquidation value rather than its cost. Standard machines appraise better than specialized ones, and existing liens on equipment must be on the debt schedule.
- What does it cost to buy a metal fabrication business with an SBA loan?
- The median acquisition loan was $832,000 at 9.25%. The buyer needs at least 10% of total project costs as equity, an independent valuation in most cases, and from 1 October 2026 financial due diligence and 1.25x coverage on historical results.