Low down payment

Borrowers typically fund 10% of the project cost, which preserves working capital for business expansion.

Loan size

Up to $1.5 million, or up to $2 million if the business is located in a rural area, if the owners belong to a minority category, or if the business need meets a public policy purpose. Manufacturing companies with specific NAICS codes can obtain up to $4 million in SBA funds.

Fixed interest rate

Helps minimize cash flow crunch that companies face during an expansion mode.

10 or 20-year loan terms

Keep monthly debt service affordable and constant.

Reduced risk

The bank lends 50% of the project cost as the first mortgage lender. The SBA 504 loan program funds 40% of the project cost in a second mortgage position, and the borrower provides 10% cash or land equity.

Alternative option

The low down payment makes SBA 504 financing possible even if conventional financing is not. 

Commitment to business growth

SBA 504 loans are another way lenders can help their small business customers expand and grow.