Borrower Benefits:
- Low down payments starting at 10%
- Long amortization schedules reducing monthly payments
- Expand your business by freeing up your cash flows
- Many rate options, even long term fixed rates
Use of Proceeds:
- Purchase, construction or renovation of owner-occupied commercial real estate
- Refinancing of existing debt is not permitted with a 504. Please refer to SBA 7a for refinance transactions
Loan Structure:
- 50% financing – First mortgage
- 40% financing – SBA 504 second mortgage (SBA/Certified Development Corporation)
- 10% minimum down payment by the borrower (15% in the case of special use properties)
- Loan sizes up to $20,000,000
Terms:
First Mortgage
- 25 years, fully amortized
- Fixed, floating and adjustable rates available
- Competitive fees
- Prepayment penalty applies & is based on various factors
Second Mortgage
- 20 years, fully amortized
- Fixed rate is determined at SBA-guaranteed 504 debenture sale
- Fees set by CDC
- Prepayment penalty for first 10 years, none after the end of year 10