First Merchants Bank logo

First Merchants Bank

SBA Preferred Lender in Muncie, IN: SBA 7(a), Express and 504 loans nationwide, $50,000 to $5,000,000 recently, 9.75% median rate, startups and acquisitions.

SBA & Government-Backed Loans:
SBA 7(a) LoansSBA Express Loans
Tags:
#Working Capital#Secured#Buying A Business

Rates & Cost

What the financing costs, normalized so lenders can be compared.

Estimated APR:
6.75% to 11.5% starting rates, median 9.75%, on 122 SBA 7(a) loans in the 12 months to Jun 30, 2026 (SBA FOIA); ~10.29% APR incl. 3% guaranty fee paid from proceeds on a $350,000 10-yr example
Pricing (as quoted by lender):
Lender does not publish rates or its spread; SBA cap Prime + 3.0% on loans over $350,000, Prime + 4.5% on $250,001 to $350,000
Cost to borrow $100K for 6 months:
≈$6,514 (interest at 9.75% on 10-yr amortization repaid at month 6 + $1,700 SBA guaranty fee)
Fees:
SBA upfront guaranty fee 2% of guaranteed portion (≤$150,000), 3% ($150,001 to $700,000), 3.5%/3.75% above; lender fees not published
Early payoff:
Allowed; SBA prepayment fee (5%/3%/1%) only on 15+ yr loans when 25%+ prepaid in first 3 years; lender policy not published
Pricing transparency (0-3):
1

Repayment Terms

How and how fast you pay it back, and how flexible it is.

Term:
120 to 312 months on the last 122 SBA 7(a) loans (56 at 120 months, 23 at 300 months) (SBA FOIA)
Repayment schedule:
Monthly, fully amortizing; all 122 recent SBA 7(a) loans variable (tied to Prime)
Flexibility in slow months:
Low — monthly fully amortizing SBA payments; variable rates rise with Prime

Eligibility & Access

Who qualifies and what you have to put on the line.

Funding amount:
$500,000 to $5,000,000 (lender, term loans); last 12 months $50,000 to $5,000,000, median $705,500 (SBA FOIA, as of Jun 30, 2026)
Minimum revenue:
Lender does not publish; must meet SBA size standards
Minimum time in business:
Lender does not publish; startups eligible (39 of 122 SBA 7(a) loans in the last 12 months)
Credit check:
Lender does not publish a score floor; full underwriting on 3 years of business and personal tax returns plus a personal financial statement
Personal guarantee:
Required from owners of 20% or more (SBA rule); personal financial statement required (lender)
Collateral & lien:
Usually secured; collateral taken on 98 of 122 SBA 7(a) loans in the last 12 months

Speed & Service

How fast you get funded and how the lender treats you.

Time to funding:
Lender does not publish; standard SBA 7(a) loans often take 60 to 90 days (third-party); PLP/Express in-house approval skips 5 to 10 business days of SBA review
Lender status:
Active (FDIC active; 122 SBA 7(a) approvals in the 12 months to Jun 30, 2026; checked 2026-10-27)

Company Verification

Who actually stands behind the lender: legal entity, registration, and how long the business and its website have existed. Checked against public registries.

Legal entity:
First Merchants Bank
Registered in:
Indiana (FDIC cert #4365)
Company formed:
Chartered 1893
Website domain registered:
Apr 1996
Share on:

Best for: Business buyers, franchisees and established firms nationwide that want an SBA 7(a) or Express loan, especially larger deals.

Not for: Owners who want posted rates or a fixed rate.

Lender List verdict: First Merchants Bank is an Indiana SBA Preferred Lender that approved 122 SBA 7(a) loans worth $144.7M in the 12 months to June 30, 2026, at a 9.75% median starting rate.

First Merchants Bank at a glance

First Merchants Bank is an Indiana bank making SBA 7(a), Express and 504 loans nationwide.

First Merchants Bank
Lender typeFDIC-insured bank (cert 4365); SBA Preferred Lender
Founded / HQ1893 / Muncie, Indiana
Amounts$50,000 to $5,000,000 on recent SBA 7(a) loans (median $705,500)
Cost (headline)6.75% to 11.5%, median 9.75% (last 12 months)
Term120 to 312 months recently
StatusActive; last SBA approval June 30, 2026

What is First Merchants Bank?

First Merchants Bank is a Midwestern bank founded in Muncie in 1893 with about $21.3 billion in assets across 135 offices in Indiana, Ohio and Michigan.

SBA data lists Indianapolis as the lending city for its 1,059 SBA 7(a) loans since FY2020, worth $751.2M across 48 states. Approvals ran 166 in FY2024, 176 in FY2025 and 93 in FY2026 through June 30. Source: SBA 7(a) FOIA data, FY2020–present, as of June 30, 2026 (data.sba.gov).

How a First Merchants Bank SBA loan works

First Merchants Bank approves most SBA loans in-house as a Preferred Lender and can pair 7(a), Express or 504 loans with conventional debt.

Of its last 122 loans, 32 financed a change of ownership. The bank cites $500,000 to $5,000,000 for term loans, yet 30 recent loans were $350,000 or less.

First Merchants Bank interest rates and fees

First Merchants Bank's SBA 7(a) loans in the last 12 months started at 6.75% to 11.5%, median 9.75%. With Prime at 7.00%, SBA caps variable loans of $250,001 to $350,000 at 11.5% and larger ones at 10.0%. SBA adds a 3% guaranty fee on the guaranteed share of loans from $150,001 to $700,000; bank fees are unpublished.

Worked example: $350,000 over 10 years at 9.75% is $4,576.96 a month, or $199,235.02 in interest. Add the $7,875 guaranty fee ($350,000 × 75% × 3%) for total cost of $207,110.02, about 10.29% APR with the fee paid from loan proceeds.

First Merchants Bank requirements

First Merchants Bank publishes no credit score or down payment minimum.

RequirementFirst Merchants Bank
CollateralTaken on 98 of the last 122 loans
Personal guaranteeOwners of 20% or more
Credit score / time in businessLender does not publish

Compare SBA 7(a) lenders, or see Byline Bank and the loan marketplace Lendio.

Frequently asked questions about First Merchants Bank

Is First Merchants Bank Legit? Yes. First Merchants Bank is an active FDIC-insured bank (certificate 4365) founded in 1893 with about $21.3 billion in assets and 135 offices. It is an SBA Preferred Lender and has made 1,059 SBA 7(a) loans since FY2020; 11 were later charged off.

How Long Does First Merchants Bank Take to Close an SBA Loan? First Merchants Bank does not publish a timeline; standard SBA 7(a) loans often take 60 to 90 days. Of its last 122 loans, 116 were approved in-house (87 Preferred Lender, 29 Express), skipping 5 to 10 business days of SBA review.

Does First Merchants Bank Lend to Startups? Yes. Thirty-nine of First Merchants Bank's 122 SBA 7(a) loans in the 12 months to June 30, 2026 funded businesses that had not yet opened, and 195 since FY2020. Collateral and owner guarantees still apply.

Does First Merchants Bank Make SBA Loans Outside Indiana? Yes. First Merchants Bank offers SBA loans nationwide. Its last 122 SBA 7(a) loans went to projects in 32 states, led by Indiana (23), Texas (15) and Florida (14), and it has lent in 48 states since FY2020.

Last verified 2026-10-27. Pricing and terms are provider-stated or third-party-reported and vary by offer; confirm with the lender before applying.

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