Key Takeaways:

• SBA loans are now only available for U.S. citizens and nationals.

• A new SBA stacking provision caps the 7A and 504 loans at $10 million, under specific conditions.

• Sunrise Banks provides other financing options through conventional loans and leverages personal relationships to connect business owners with community resources for other funding options.

Small businesses are the backbone of many communities, especially those in Minnesota and South Dakota. At Sunrise Banks, we’re proud to work with so many of these entrepreneurs and business owners who are providing essential services to our communities.

Providing those services often requires capital that comes in the form of loans. Many business owners turn to Small Business Administration loans, but changes have been made to that program in 2026. If you don’t qualify for an SBA loan, there are other options available.

What are the two biggest Small Business Administration loan changes?

In March 2026, the SBA announced Off Site Link that, to qualify for a loan, direct and indirect business owners have to be U.S. citizens or nationals. Previously, businesses could qualify for SBA loans if the owner was a legal permanent resident. About 5% of loans were given to foreign nationals. If someone is not an American citizen or national and already holds an SBA loan, it is likely that they will be grandfathered into the program, based on current guidance.

The other big change coming in July 2026 is a new stacking provision for the 7A Off Site Link and 504 Off Site Link loan programs. In the past, the cap for a business applying for both loans was $5 million. Under the new change, that total rises to $10 million, as long as it’s done in a specific way. That process is:

• Applying for the 7A loan first, up to $5 million
• Then, applying for the 504 loan, up to $5 million
• And the business must meet all eligibility conditions

In the past, if small businesses were looking for more than $5 million, they would likely need to find a bank that would give them a conventional loan for the outstanding amount. This could be a challenge because some banks may not want to take on the additional risk of larger deals.

What are financing options for small businesses that are not using SBA loans?

For those who don’t qualify for an SBA loan, it’s not the end of the road. Our team at Sunrise Banks is here to help you identify other financing options.

We want to see our community succeed, which is why we collaborate with so many community partners and nonprofits. Many of these organizations can provide financing when traditional bank loans aren’t available. A lot of these organizations also have broader underwriting standards and can provide technical assistance for entrepreneurs.

Many of our lenders at Sunrise Banks have personal connections with these organizations and can provide additional resources to help a business owner. This happened recently when a customer came in who was already operating a cleaning business and was looking to open a restaurant in South Minneapolis. He had a background running a business and was a chef with more than 20 years of experience, but we knew bank financing wouldn’t be his best option. Instead, we introduced him to someone at the Latino Economic Development Center (LEDC) Off Site Link who helped get the project started. In many cases, when this happens, the business owner will get help from one of these organizations and come back to Sunrise Banks once they’re established for a line of credit or growth financing.

Small businesses are important for everyone throughout Minnesota and South Dakota, and we will do everything we can to help them succeed.

Rich Esquivel is a Vice President, Senior Business Development Officer at Sunrise Banks.

Bee Moua is Vice President, Director of SBA Loans at Sunrise Banks.

Visit sunrisebanks.com/business-banking Off Site Link to learn more about our solutions for small businesses.

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