Industry data
Financing for test prep centers: what the loan data shows
215 SBA 7(a) loans went to test prep centers recently, at a median of $150,000. The lenders that make them, the terms they write, and what underwriters look at.
215 SBA 7(a) loans went to test prep centers in the most recent fiscal years, at a median of $150,000 over 10 years. 33.5% went to new or under-two-year-old businesses, and the most active lender was BayFirst National Bank.
What a test prep center loan actually looks like
These are approvals, not advertised ranges. Computed from SBA 7(a) loan-level FOIA data released 2026-06-30.
| Measure | Exam preparation and tutoring centers | All 7(a) borrowers |
|---|---|---|
| Loans approved, fiscal years 2023 to 2026, using data released June 2026 | 215 | 214,102 |
| Median loan | $150,000 | $150,000 |
| 25th - 75th percentile | $55,000 - $337,500 | $50,000 - $500,000 |
| Median term | 10 years | 10 years |
| Median initial rate | 10.75% | 10.25% |
| Share to new businesses | 33.5% | 33.6% |
| Charge-off rate, FY2010-19 | 13.7% | 7.1% |
What stands out
Reading these figures against all 7(a) borrowers:
- Loan sizes are typical. The median of $150,000 is within a few percent of the $150,000 national median across all 7(a) borrowers, so nothing about this market is unusual on size.
- Startup share is about average, at 34% against 34% nationally.
- Lending here is fragmented. The top three lenders made only 19% of these loans between them, so no single institution owns this market. That is good news: it means shopping genuinely pays.
- Rates run higher here. The median initial rate of 10.75% is 0.50 points above the 10.25% national median, which usually tracks loan size and perceived sector risk rather than geography.
- Lenders have been burned here before. 13.7% of loans to this market from the FY2010-2019 cohorts were charged off, against 7.1% overall. That history is why underwriting in this sector is tighter than the numbers alone would suggest — it is not personal.
Which lenders actually fund test prep centers
Ranked by loans approved in this niche. The median, startup share and rate describe each lender's own loans to test prep centers, not its national averages — which is how you spot a genuine specialist.
| Lender | Loans | Median loan | Startup share | Median rate |
|---|---|---|---|---|
| BayFirst National Bank | 15 | $91,600 | 0% | 12.25% |
| U.S. Bank | 13 | $50,000 | 31% | 9.25% |
| TD Bank | 13 | $30,000 | 8% | 11.50% |
| The Huntington National Bank | 12 | $125,000 | 33% | 9.75% |
| Readycap Lending, LLC | 9 | $178,500 | 0% | 11.25% |
| Live Oak Banking Company | 9 | $250,000 | 44% | 9.99% |
| Newtek Bank | 8 | $112,500 | 62% | 11.12% |
| First Bank of the Lake | 8 | $318,500 | 88% | 10.75% |
| Manufacturers and Traders Trust Company | 7 | $45,000 | 71% | 10.50% |
| JPMorgan Chase Bank | 6 | $150,000 | 0% | 12.40% |
Where these businesses borrow
Most active states for test prep centers: California (38), New York (25), Florida (17), Texas (16), Georgia (12), Ohio (9).
Which financing fits
| Product | Fit for this sector | Typical cost |
|---|---|---|
| SBA 7(a) | The dominant vehicle in this niche | 10.0% - 14.0% APR |
| Equipment financing | For the hard assets, often cheaper separately | 7.0% - 30.0% APR |
| Line of credit | For seasonality and payroll timing | 9.0% - 60.0% APR |
| SBA microloan | If you need under $50,000 | 8.0% - 13.0% APR |
| Business acquisition loan | If you are buying an existing operation | 10.0% - 14.0% APR |
Before you apply
- Check coverage first. Run the payment through the affordability calculator at 1.25x.
- Shortlist from the lender table, favouring ones whose median loan here is close to what you need.
- Assemble the documents — see the checklist.
- If you are buying rather than starting, read business acquisition loans first; the injection rules and diligence are different.