SBA 504 Loan Program

• Any for-profit businesses—corporation, partnership or proprietorship—are eligible to apply. The business tangible net worth may not exceed $15 million and the net profit after tax may not exceed $5 million.

• Not for profits
• Speculative Developers
• Insurance Companies
• Gambling Concerns
• Private Clubs that restrict membership

• Up to 40% of eligible cost, with a $5,000,000 maximum
• Manufacturers and energy efficiency projects are eligible for up to $5,500,000
• These projects enable unlimited access to SBA funding and the total project size is unlimited

• Purchase of land
• Construction of building
• Purchase of building
• Modernization, renovation or improvement of building
• Purchase of machinery or equipment with useful life of 10 years or more

• Working Capital
• Inventory
• Rolling Stock

• Private lender provides 50% of project cost, and SBA 504 Loan provides 40%
• Equity requirements are at least 10%

• Maximum of 40% of project
• Terms of 20 years for real estate, 10 years for machinery and equipment
• Fixed, below-market interest rate
• Total fees of 2.17%, plus an attorney closing fee
• Fees can be included in the 504 loan amount and financed over a 20-year term

This breakdown would be for a project with total costs of $1 million:

SBA defines certain properties as special purpose. This list is not intended to be all-inclusive.

• Car wash business
• Gas stations
• Hotels, motels and other lodging facilities
• Hospitals, nursing homes and assisted living centers
• Marinas
• Farms, including livestock and dairy facilities

This breakdown would be for a project with total costs of $1 million

The SBA defines startup businesses as those that have been in operation for less than two years.  These businesses are eligible for SBA 504 loans; however, they require an additional 5% down payment. (Financing breakdown is same as table above)

This breakdown would be for a project with total costs of $1 million

NOTE: Estimated pricing published by Eagle Compliance, LLC, the program’s fiscal agent. 25- and 20-year term loans fund every month; 10-year term loans fund every other month. Effective interest rates are inclusive of servicing fees. Servicing fees are subject to credit risk of the applicant. Official monthly SBA 504 effective interest rate tables can be found at Eagle Compliance LLC.