SBA CAPLines are four specialized SBA 7(a) line-of-credit structures designed for specific cash-flow shapes: Seasonal CAPLine (seasonal businesses), Contract CAPLine (contract-awarded businesses), Builder's CAPLine (construction/homebuilders), and Working Capital CAPLine (general-purpose revolving). Max $5M per line; terms up to 10 years.
SBA CAPLines are a subset of the SBA 7(a) program offering revolving or non-revolving lines of credit up to $5 million, structured to match specific operating cash-flow patterns that a standard term loan doesn't fit. The SBA SOP 50 10 (https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs) defines four CAPLine types: 1. Seasonal CAPLine: funds working capital for businesses with seasonal revenue cycles (retailers, landscapers, seasonal hospitality). Draws permitted only during the active season; repayment required during off-season from season proceeds. 2. Contract CAPLine: finances the direct costs of specific contracts awarded to the borrower. The line is secured by the contract proceeds. Ideal for government contractors and project-based businesses. 3. Builder's CAPLine: finances direct construction costs for licensed builders and general contractors who build or renovate commercial or residential real estate for sale. Advances made as construction milestones are met. 4. Working Capital CAPLine: a general revolving line of credit for ongoing working capital — accounts receivable, inventory, and operating costs. Revolves on a 12-month cycle; advance rates typically 80-85% of eligible AR and 50-65% of eligible finished goods inventory. All CAPLines are SBA-guaranteed at 75-85% (like standard 7(a)) and priced at prime + a spread. Terms up to 10 years on the Working Capital CAPLine; shorter on the contract and seasonal variants.
SBA Express lines of credit (up to $500K) and standard 7(a) revolving lines exist, but CAPLines are specially structured for cash-flow-specific use cases. Seasonal CAPLines can only be drawn in-season; Contract CAPLines are tied to specific contract proceeds; Builder's CAPLines advance against construction milestones. If your business has a standard revolving capital need, a Working Capital CAPLine or Express LOC may be more flexible.
Yes — but a standard term loan has fixed monthly payments regardless of season, which can create cash-flow stress during the off-season. The Seasonal CAPLine is specifically designed to match repayment timing to revenue timing. For businesses with strong seasonal cash flow patterns, the CAPLine structure is typically more appropriate.