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 Garfield 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 Company Near Me In Garfield 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 Garfield 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 development corporation in Garfield County. The loan is preferably suitable for a small company that has an interest in building or purchasing their owner-occupied industrial real estate.
The program works by bringing 2 lenders together to fund the purchase of commercial real estate. Usually, these 2 lenders are the CDC and a traditional lender or bank.
These plans work where the bank loans the customer as much as 50 percent, CDC loans up to 40 percent while the borrower chips in the 10 percent typically as a cash deposit.
Loan Requirements for a SBA 504 Loan
There are 2 primary requirements that your organization in Garfield County WA should fulfill in order to qualify for a SBA 504 loan. These consist of having a credit score of 680 plus and a capability to make a 10 percent down payment for the project.
Besides the two, you will have to not have the required funding form any other source or be involved in the real estate rental investment.
Your business in Garfield County WA will need to have a substantial net worth of less than $15 million, have the ability to make the loan payment on time from the expected operating capital from the business along with occupy 51 percent of the building.
SBA 504 loans are therefore perfect for any business that has an interest in the purchase of industrial real estate and can ensure 51 percent occupancy of the area while renting out the remaining 49 percent.
Loan Terms and Interest Rates
The two different kinds of loan— from the bank and the CDC– that make up the SBA 504 Loan usually have different terms, limits, rates, and costs.
The rates combined comprise the overall loan rate on your CDC/SBA 504 Loan.
Typically, your organization will pay an interest rate of between 4 and 6 percent on the whole loan with a repayment length of 25 years.
The SBA sets a limitation on the terms, fees and rate of interest that is given by the CDC which covers 40 percent of the entire project expense.
With a 10-year CDC loan, the fixed rate of interest 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 standard lenders such as banks or other financial institutions which leaves space for negotiations for the loans.
Nevertheless, the rates of interest are typically 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 several 504 loans for multiple reasons, the loan amount can increase to $20 million.
As a business, if you are not thinking about getting funding from a CDC, your best option is the SBA 7a loan.
Applying for a SBA 504 Loan
The SBA 504 loan application resembles that of the SBA 7a loan in terms of the amount of time and documentation needed to get the financing.
In addition, your business will need to give additional documentation on the commercial property that is being funded.
In either case, consider a proper amount for your company and whether you can satisfy your lenders’ requirements.