Loan Programs: SBA 504

SBA 504 (Small Business Administration)
allows for the following loan purposes:

• Land acquisition and improvements
• Purchase and/or renovate existing buildings
• New construction
• Equipment, furniture and fixtures
• Project professional fees
• Interest and 'Points' on interim loan

Typical Financing Structure for the Above Loans:

• Bank - 50%
• SBA - 40%
• Borrower Injection - 10%.
  For a new business, Borrower Injection increases to 15%. Contact the RLC if other specifics are involved.

SBA 504 Loan Advantages:

• FIXED rate for term of loan - normally below bank rates, no interest rate risk on SBA portion of debt
• 20-25-year term on real estate
• 10-year term on equipment
• Preservation of capital due to low equity injection requirements
• Most project fees (closing costs, appraisal, environmental and architect fees) can be financed
• SBA Loan amounts up to $5 million to $5.5 million for manufacturers

Eligibility Criteria:

• Business organized for profit
• Combined tangible net worth of business and affiliates not to exceed $15 million
• Combined net profits after taxes average less than $5 million for previous two years
• Useful life of fixed assets must be a minimum of 10 years
• Project must demonstrate job creation or retention