SBA 7(a) Child Care Center Feasibility Study in Utah

Utah child care: credit unions and larger tickets

Utah child care centers drew 89 loans from the 7(a) program in the years FY2017 to FY2026, worth $55.5 million. The class holds 9 of 39 positions in the state and Utah ranks 23 among states. The median loan is $439,300, or 1.14x the national level, and the middle half falls between $110,000 and $795,600. Franchising is thin at 5.6%. Utah child care borrowers lean larger than the country, and the book is gathered in a few counties: Salt Lake County holds 43 loans, Utah County 16 and Davis County 12, while Cache and Weber hold 4 each.

Who holds the loans

The listing puts Mountain America FCU at the top with 13 loans and $5.3 million, then America First Federal Credit Union with 12 and $7.5 million. Zions Bancorporation, National Association has 9 for $2.4 million, while the 7 loans of U.S. Bank, National Association come to $3.2 million; Live Oak Banking Company's 5 loans total $3.5 million. Credit unions therefore hold two of the top places. These are holder records only. Approvals rose to 16 loans and $13.4 million in FY2025 and had been 10 loans and $10.6 million in FY2021, but there were only 3 loans and $419,400 in FY2023 and 4 in FY2026.

Cancellations and charge-offs

At least 15.9% of approvals through FY2024 were lost to cancellation, with no change under the broader reading. Among 41 early funded loans, 2.4% have been charged off so far, but none inside five years, which reads as 0.00%. Loans still open keep these as minimums.

What the code covers

Utah's record cannot tell a child care centre from a family child care home, because the industry code holds both. A project in a home setting should be judged on its own.

A Utah child care study must prove demand with the numbers a lender can check: children under school age in the trade area, working-parent households, nearby licensed centres and their enrolment, and waiting lists where they exist. Licensing ratios drive staffing, so the model should tie enrolment by age group to teachers and to tuition. Staff turnover and wages belong in the base case. Build-out costs should cover playground, kitchen and safety requirements, and the lease or purchase should be tested against the revenue at stabilised enrolment, with a slower lease-up case. Cancellation was high here, which is a reason to confirm licensing and zoning before the loan relies on a site. An appraisal will value the building for alternative use as well as for child care.