SBA 504 Loans

Financing designed for small business needs.

Capital CDC Borrower

J. Stoilis Design

Santa Fe, New Mexico

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Grow Your Business with Funding For

Acquisition of Existing Building
Construction
Fixed Assets from Business Acquisition

Purchase of Land
Purchase Equipment
Building Expansion or Renovation

Professional Fees
Debt Refinance
Lender's Interim Points & Interest

Financing Structure

The typical SBA 504 Loan structure is as follows: 50% lenders note, 40% SBA 504 note and 10% borrower contribution.

Lender (50%)
CDC / SBA 504 (40%)
Borrower Contribution (10%)

Current Rates

5.765%

25-year debentures 25-year debentures Tooltip

5.833%

20-year debentures 20-year debentures Tooltip

5.875%

10-year debentures 10-year debentures Tooltip

Benefits of the SBA 504 Loan

For Borrowers

Finance up to 40% of the project
at a long-term, fixed rate
Lower equity contribution
as little as 10% of project to preserve working capital
Eligible soft costs may be rolled into the project financing
Debt refinancing available

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For Lenders

Strengthen lender loan portfolio
with 1st lien position and low Loan-to-Value
Preserve borrower's working capital
Fixed interest rate helps lenders compete for more business
Offers creative financing to differentiate your lending institution in the marketplace

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Positioning Businesses for Growth

SBA 504 Success Story

Amazing Magnets

Round Rock, Texas

Why the SBA 504 Loan is Right for You

Low down payment
conserve working capital
10, 20, or 25-year terms
brings debt service in line with cash flow generated by the asset

Fixed interest rate
rate locks-in at funding
Improve collateral position
to increase borrowing capacity at lower rates

Refinancing
potential refinancing of existing debt related to fixed assets

SBA 504 Loan Eligibility Requirements

Most for-profit, owner-occupied small businesses in the U.S.
Tangible Net worth less than $20 million
Net profit is no more than $6.5 million
2-year average after tax (including affiliates)
Manufacturers
With 500 or less employees (including affiliates)

Capital CDC Borrower

Meanwhile Brewing

Austin, Texas

SBA 504 Loan Programs

Commercial Real Estate & Equipment Loan

Providing up to 90% financing for commercial property and equipment purchases.

For-profit, owner-occupied small businesses in U.S.
Tangible net worth less than $20 million
Net profit after tax (2-year average) of no more than $6.5 million (including affiliates)

Download the SBA 504 Guide

Refinancing

Co-Lender financing designed to refinance existing commercial real estate or equipment debt.

For-profit, owner-occupied small businesses in the U.S.
Businesses with at least two years of operations and whose debt is at least 6 months old (projects without expansion only).
Business must occupy at least 51% of its property at the time of application

Download the SBA 504 Refi Guide

Green Energy Program

Secure up to $5.5 million for projects that meet SBA's green energy standards and meet one of the following goals to qualify:

Reduce energy use by 10%
Renewable energy sources that generate at least 15% of the energy used
Increased use of sustainable designs
Most energy improvements & equipment can be rolled into the loan

Download the Green Energy Guide

Find Your Loan Officer Today!

Feel confident knowing we are the leading non-profit provider of small business financing. Our Loan Officers are experts and have been helping people fund their dreams since 1993.

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Frequently Asked Questions

Most for-profit, owner-occupied businesses in the U.S. that fit SBA’s definition of “small” are eligible for SBA financing. Certain types of businesses are ineligible including non-profits, businesses engaged primarily in lending, businesses engaged primarily in real estate investment or oilfield development, and businesses producing or selling “adult”-oriented entertainment. Contact your regional Loan Officer for more information.
Borrower's Injection is the Borrower’s down payment for the 504 project, as defined in the loan Authorization. This amount must be paid by the borrower and contributed into the SBA 504 project. Prior to closing, the required contribution or “injection” is fully documented with dated invoices and payments. Use of Proceeds is evidence of how the bank funds were utilized to purchase real estate, equipment or complete all construction as defined in the SBA loan Authorization. This significant detail is provided by the bank primarily and is a critical part of every loan closing.
By working closely with your Closing Officer and Closing Attorney, you can minimize delays and expedite any necessary changes required after the loan was approved by SBA. Providing any documents requested in their checklists and regularly checking in with your bank is important to a smooth closing/funding process. Some of the requested documents will be duplicates of what was provided during loan underwriting. However, due to document expiration dates, current and updated versions are needed.
The loan Authorization can be amended and changed to match the changes taking place within your particular project (i.e. construction or equipment cost changes, purchasing a different property, adding equipment, or change of entity ownership and loan guarantors). These changes are formalized between the Closing Officer and SBA and are subject to SBA approval. Having multiple changes may create a delay the closing of your project.
The banks closing takes place prior to the CDC closing/funding and initiates the movement of funding for all purchases and construction. The CDC closes/funds after all purchases (real estate and equipment) and/or construction are 100% finalized. The 504 loan has a built-in reimbursement to the borrower for the CDC closing costs. The reimbursements to the borrower will be sent 30-45 days after the CDC closing.