Top Lenders for Machine Shop SBA Loans

Last update: May 29, 2024

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Top Machine Shop Lenders

RankSBA LenderLender CityState# of Loans Avg LoanAvg Rate
1Live OakWilmingtonNC15 $1,898,0009.8%
2Celtic BankSalt Lake CityUT15 $1,436,01310.4%
3Pinnacle BankMorgan HillCA9 $1,341,55610.1%
4Noah BankMiamiFL7 $817,85712.0%
5Harvest Small Business FinanceLaguna HillsCA7 $1,213,60010.5%
6Newtek BankMiamiFL7 $817,85712.0%
7Huntington BankColumbusOH5 $123,60010.2%
8Gesa CURichlandWA5 $1,201,60010.2%
9Commonwealth Business BankLos AngelesCA5 $1,188,0009.7%
10Byline BankChicagoIL5 $1,962,00010.5%
11Umpqua BankRoseburgOR5 $990,10011.6%
12Readycap Lending, LLCBerkeley HeightsNJ4 $604,15012.1%
13US Metro BankGarden GroveCA4 $1,651,25010.2%
14Wells FargoSioux FallsSD4 $106,12512.6%
15America First FCURiverdaleUT4 $2,997,0007.0%
16Bank Five NineOconomowocWI3 $987,5009.8%
17Banco Popular de Puerto RicoSan JuanPR3 $108,30012.7%
18Hiawatha National BankHager CityWI3 $889,0009.3%
19Wallis BankWallisTX3 $3,346,0009.8%

Recent Machine Shop Loan Activity

YearQtr# of Loans Avg LoanAvg Rate*
2024141 $572,02210.3%
2023441 $801,10010.7%
2023343 $811,43310.2%
2023242 $615,6299.7%
2023132 $551,4389.2%
2022441 $852,6378.2%
2022334 $821,0157.2%
2022226 $764,5006.2%
2022151 $602,0435.2%
2021427 $683,9375.2%
2021380 $1,036,5814.9%
2021250 $623,4965.1%
2021121 $1,284,6335.2%

* Note that most SBA loans are variable-rate loans. The rates listed above is the initial interest rate at loan closing. Variable-rate SBA loans fluctuate by the fed funds rate set by the Federal Reserve.

The machine shop industry is crucial to the industrial output of the United States. A critical part of the industrial supply chain, the skilled machinists at these businesses forge and create equipment that’s used in everything from household appliances to aircraft. By revenue, the machine shop services industry is worth almost $42 billion in the United States.

Industry analysts expect that the market size for machine shop services is going to increase by 2.4% in 2020 and will continue to exhibit healthy growth in the years to come. Given the future growth prospects, many business owners are now looking to expand into this arena by actively seeking out machine shop loans.

Benefits of owning a machine shop business

 As industrial output reaches pre-pandemic levels, the demand for machine shop services is higher than ever. The services that these businesses provide are critical to supporting the industrial operations of some of the biggest companies in the country.

With that being said, this is a capital-intensive business. Equipment is one of the biggest expenses since a machine shop business can’t operate without out. Such equipment tends to be expensive and those who are just starting out in this industry often find it difficult to get up and running without acquiring machine shop loans.

As demand for products increases in the United States, the industrial output has to rise to cater to it. This will increase demand for machine shop services. Business owners in this industry can thus rely on sustained growth in the coming years.

How to get money to buy a machine shop business

 Money is the biggest barrier to entry for this industry. You need a lot of it to start or acquire a machine shop business. Equipment remains the business expense. A full-fledged machine shop will require everything from CNC and milling machines to 3D printers, threading, grinding, and drilling equipment.

Acquiring an established machine shop business will require even more funds as you’ll be paying not just for all of the equipment that the shop already has but other facilities as well. You’ll probably need machine shop loans that run into millions of dollars to secure the required financing.

This can be difficult to achieve through conventional banks as they may not be willing to lend such significant sums without requiring collateral, particularly to those who are just starting out in this industry.

SBA machine shop loans

Fortunately, the SBA has a loan program that’s a perfect fit for business owners in the machine shop industry. It enables them to borrow several million dollars that can be utilized for the purchase of equipment, and real estate, and also to meet working capital requirements.

The loans are provided by conventional banks and financial institutions, but they are guaranteed by the Small Business Administration. This enables you to obtain machine shop loans at lower interest rates with extended repayment periods.

SBA 7(a) machine shop loans

Given the capital-intensive nature of this business, the SBA 7(a) loan program is perfect for business owners who either want to set up a new machine shop or acquire an existing one. This program offers the most amount of financing that you can obtain through the Small Business Administration.

You can obtain up to $5 million in financing through the SBA 7(a) loan for a machine shop business. These funds can be used to purchase all of the equipment that you’ll need for the shop in addition to meeting your short and long-term working capital requirements. The SBA 7(a) loan funds can also be utilized to purchase real estate, furniture, and fixtures. Refinancing current business debt is also allowed.

The loans are disbursed through SBA’s lending partners which include nationwide banks, credit unions, and other financial institutions. Since a large chunk of the loan is guaranteed, they’re more receptive to applications for machine shop loans.

The maximum maturity for the loan is 25 years if obtained for real estate or 10 years for inventory. If the loan will be used for several purposes, the maximum maturity can be a blended maturity.

The interest rate will be negotiated between you and the lender, but they are subject to SBA maximums. There’s a cap of base prime rate plus 2.75% if the loan maturity is more than 7 years.


How to apply for SBA machine shop loans

We work with a vast network of nationwide lenders that can provide quick approval for SBA machine shop loans. Our SBA Preferred Lenders also include banks and credit unions that are experienced in approving loans for business owners in the machine shop industry, thus increasing your chances of unlocking the funding you require to take your business to new heights. Just provide us some basic information here, and we can provide access to our SBA lender network.

SBA loans for machine shops are a great option for business owners who want to set up a new machine shop, acquire or expand an existing one. There are countless SBA approved lenders that are ready to provide machine shop loans at competitive rates and flexible payment terms. The list below includes the rest of our best SBA approved lenders for machine shops:

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