Build Bigger and Better with SBA 504 Funding
Fuel your business growth with SBA 504 loans—a government-backed solution designed for substantial business investments. Offering long-term, fixed-rate financing, SBA 504 loans are perfect for businesses looking to make significant upgrades or purchase fixed assets, such as real estate or major equipment.
With repayment terms of up to 25 years and competitive low interest rates, SBA 504 loans allow you to maintain liquidity while making long-term improvements to your business infrastructure. If you’re planning a major asset purchase or business expansion and don’t need immediate access to capital, an SBA 504 loan
Let us help you unlock the financing you need to take your business to the next level!
Advantages of SBA 504 Loans
SBA 504 loans for commercial properties have several advantages that make the loans attractive in various situations:
- Fixed-Rate Loan: This allows small businesses to calculate their mortgage payments for the span of the loan.
- Low Down Payment Requirements: In most cases require 10% of the total project cost, including renovations and soft costs. Allowing small businesses to preserve cash for working capital.
- Long Terms: 10 or 20 years.
- Low-Interest Rates: Even when the fees and closing costs are included in the rate.
- Costs: Soft costs like legal fees, appraisals, environmental studies can be rolled into the loan.
Disadvantages of SBA 504 Loans
Even with their many advantages and overall flexibility, there are some disadvantages that come with SBA 504 loans. Some of the more noteworthy disadvantages are that:
- Availability: The loan program is only available for owner-occupied properties and is only available to small businesses.
- Requirements: Under SBA 504 guidelines, the business must create one job or retain an existing job for every $65,000 they receive through the program.
- Longer Application: The application process and underwriting take longer than a conventional loan, due to having three parties involved. Both CDC and the lender must agree to the term. SBA underwriting is done through a single office, which can create wait times. The underwriters are thorough and will question anything out of the norm.