Another of the Small Business Administration’s popular loan programs is called the SBA 504 loan. In a nutshell, the SBA 504 loan program is a long-term loan set with a fixed rate at 10-percent down. Know that it has the government-backed guarantee you desire and the terms and rates your small business needs to keep from a crippling small business loan without this vitally important protection. At SBALoanOnline, we provide SBA 504 loan services in Cowlitz County and have developed a quick and easy process so you don’t have to worry about how to navigate the government’s sometimes tricky and confusing process.
SBA 504 Loan Specialists Near Me In Cowlitz County Washington
Keep in mind, one of the primary reasons for owning your own business is to control your own business and personal fate, so don’t get into a loan or financial situation where you’re tied to rates and terms that tie you down. Let the highly skilled and trained experts at SBALoanOnline help you understand the SBA 504 program and how it can help you expand your capital access in the most financially friendly terms and rates. We’ll work tirelessly for you the moment you reach out to us for assistance. Each of our team members has tons of experience with SBA loan programs.
Get A SBA 504 Loan Today – (424) 343-1099
So if you’d like more information about the SBA 504 loan program and would like to obtain one today, call the nationwide experts at SBALoanOnline. One of our friendly and knowledgeable associates in Cowlitz County WA is standing by right now to answer any question and get your application ready to roll, so to get a SBA loan now, call us at (424) 343-1099.
Qualifying For a SBA 504 Loan
The SBA 504 Loan is a program that also incorporates a community advancement corporation in Cowlitz County. The loan is ideally suitable for a small business that is interested in building or purchasing their owner-occupied business real estate.
The program works by bringing two lenders together to fund the purchase of commercial property. Usually, these two lenders are the CDC and a traditional lender or bank.
These arrangements work where the bank loans the borrower up to 50 percent, CDC loans as much as 40 percent while the borrower chips in the 10 percent usually as a cash down payment.
Loan Requirements for a SBA 504 Loan
There are two primary requirements that your company in Cowlitz County WA need to meet in order to get approved for a SBA 504 loan. These include having a credit score of 680 plus and an ability to make a 10 percent down payment for the project.
Besides the two, you will need to not have the needed financing form any other source or be involved in the real estate rental financial investment.
Your business in Cowlitz County WA will need to have a substantial net worth of less than $15 million, have the ability to make the loan repayment on time from the expected operating cash flow from business in addition to occupy 51 percent of the building.
SBA 504 loans are therefore perfect for any business that is interested in the purchase of industrial real estate and can guarantee 51 percent occupancy of the area while leasing the remaining 49 percent.
Loan Terms and Interest Rates
The two various kinds of loan— from the bank and the CDC– that comprise the SBA 504 Loan generally have various terms, limits, rates, and costs.
The rates integrated make up the total loan rate on your CDC/SBA 504 Loan.
Usually, your business will pay an interest rate of in between 4 and 6 percent on the whole loan with a repayment length of 25 years.
The SBA sets a limit on the terms, fees and rate of interest that is given by the CDC which covers 40 percent of the whole project cost.
With a 10-year CDC loan, the fixed interest rate will be about 4.67 percent with a 20-year one having a fixed interest of 4.95 percent.
Conventional SBA 504 Loan Lenders
While the SBA sets the limit on the CDC loans, it does refrain from doing the same for the conventional lenders such as banks or other banks which leaves space for negotiations for the loans.
Nevertheless, the rate of interest are generally between 5 and 9.5 percent with a reset point. The loan amount for a SBA 504 loan is typically around $14 million.
Since borrowers can take on multiple 504 loans for numerous projects, the loan amount can increase to $20 million.
As a company, if you are not thinking about getting financing from a CDC, your finest option is the SBA 7a loan.
Requesting a SBA 504 Loan
The SBA 504 loan application resembles that of the SBA 7a loan in terms of the amount of time and paperwork needed to get the financing.
Additionally, your business will need to give additional documents on the commercial property that is being funded.
Either way, consider an appropriate amount for your organization and whether you can fulfill your lenders’ requirements.