LIONs Act Proposes Doubling SBA Loan Limits for Small Businesses and Development Projects

The Loans In Our Neighborhoods Act of 2025, or LIONs Act, aims to significantly increase the maximum loan amounts available through key Small Business Administration (SBA) programs. Specifically, it proposes amending the Small Business Act to raise the cap for 7(a) loans from the current $3,750,000 up to $7,500,000. It also seeks to amend the Small Business Investment Act of 1958, boosting the maximum loan amount for development companies (often associated with the 504 loan program) from $5,000,000 or $5,500,000 (depending on the project type) to a uniform $10,000,000.

Boosting Borrowing Power

This legislation directly targets the upper limits of two major SBA-backed loan programs. The 7(a) loan program is the SBA's primary vehicle for providing financial help for general business purposes, including working capital, machinery, equipment, and sometimes real estate. Doubling its cap to $7.5 million could allow businesses undertaking larger expansions or needing more significant capital injections to utilize this program. For instance, a mid-sized manufacturing company looking to invest $6 million in advanced automation equipment, previously exceeding the 7(a) limit, might now find this financing route viable.

Similarly, the proposed increase for development company loans to $10 million addresses financing typically used for major fixed assets like land, buildings, and long-term equipment, often aimed at economic development and job creation. A local development group planning a substantial commercial revitalization project requiring $8 million in fixed asset financing, which was previously above the program's ceiling, could potentially secure the needed funds under this new, higher limit.

Potential Impacts on Main Street

The core idea behind raising these loan ceilings is to provide greater access to capital, enabling small businesses and development initiatives to pursue larger-scale projects. By facilitating more substantial investments, the LIONs Act could potentially fuel business growth, support job creation, and encourage more significant community development efforts. Businesses hitting the previous borrowing caps might now have the runway to expand operations, purchase necessary real estate, or invest in productivity-enhancing technology. While increased loan availability offers opportunities, it also underscores the importance of sound financial planning and responsible lending practices by all parties involved as borrowing capabilities expand.