D.C. City Councilman Douglas E. Moore and his wife have agreed to repay a $21,500 Small Business Adminstration loan over the next 15 years to settle a lawsuit filed against them by the SBA.

The SBA filed the suit in January, claiming that Moore had made only a few payments on the loan since he signed a promissory note in April 1971.

Under yesterday's agreement, Moore and his wife will pay approximately $120 a month for the next 15 years to pay off the principal and will not have to pay any interest. The original terms of the note called for $272 monthly payments over a 10-year period, plus interest.

Persons familiar with similar suits by SBA said the special payment arrangement was not unusual, because the government is attempting to recover as much of the loan as possible once the matter has reached court.

As security for the loan, the Moores are executing a second deed of trust on their house at 1300 Newton St. NE, according to the settlement filed in court and approved by U.S. Court District Judge Charles R. Richey.

Moore and his wife took out the loan for a firm he headed called Pan African Enterprises Inc., an African specialty shop at 3622 Georgia Ave. N.W. He apparently used part of the original loan to purchase the buildinf in which the shop was housed, and then lost the building in a foreclosure auction after failing to make mortgage payments.

Moore, a 49-year-old Methodist minister whose current council salary is $28,444 a year, is a candidate for chairman of the D.C. City Council. An aide said yesterday he would have no comment on the settlement of the SBA suit.