The SBA 504 Loan Program is used to finance the purchase of fixed assets, including owner-occupied commercial real estate and equipment.
SBA 504 loans are primarily used to purchase long-term fixed assets. These assets can include commercial real estate, property improvements, furniture, fixtures, and equipment, and can also include ground-up construction.
The SBA 504 Loan Program typically has terms up to 20 years with a fixed rate on the CDC portion. At FNB Small Business Finance, we typically offer a 25-year term on the First Mortgage with rates that adjust every 5 years. There is no minimum size for an SBA 504 Loan, and they can typically be used for projects up to $10 Million or more.
To be eligible for the SBA 504 Loan Program, a business must be for-profit and fall within a size limit of having a tangible net worth of less than $15 Million and have had an average profit of less than $5 Million in the last two years. These loans are subject to underwriting by the bank, the CDC, and the SBA. SBA 504 loans have a job creation requirement of one new job for every $65,000 of loan proceeds.
Documents to have available for a call with our team:
- All current mortgage statements
- Current bank statements and/or account balances
- List of all owners having 20% or more ownership in the subject business along with any affiliates (if applicable)
- List of all current business debts and their respective monthly payments
- Tax Identification Number for the business and/or its affiliates
- DUNS (Data Universal Numbering System) number