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 Klickitat 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 Specialist Near Me In Klickitat 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 Klickitat 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 neighborhood advancement corporation in Klickitat County. The loan is preferably suitable for a small business that is interested in building or buying their owner-occupied industrial real estate.
The program works by bringing two lenders together to fund the purchase of business real estate. Typically, these two lenders are the CDC and a standard lender or bank.
These arrangements work whereby the bank loans the customer as much as 50 percent, CDC loans up to 40 percent while the debtor chips in the 10 percent usually as a cash deposit.
Loan Requirements for a SBA 504 Loan
There are two primary requirements that your organization in Klickitat County WA need to fulfill in order to qualify for a SBA 504 loan. These include having a credit history 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 required financing form any other source or be involved in the property rental investment.
Your business in Klickitat County WA will need to have a considerable net worth of less than $15 million, have the capability to make the loan repayment on time from the anticipated operating cash flow from the business as well as inhabit 51 percent of the building.
SBA 504 loans are therefore ideal for any company that is interested in the purchase of industrial real estate and can guarantee 51 percent occupancy of the space while renting 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 normally have various terms, limitations, rates, and fees.
The rates combined comprise the overall loan rate on your CDC/SBA 504 Loan.
Usually, your company will pay a rate of interest of in between 4 and 6 percent on the whole loan with a payment length of 25 years.
The SBA sets a limit on the terms, costs and rates 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 rates 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 room for negotiations for the loans.
However, the rate of interest are usually in between 5 and 9.5 percent with a reset point. The loan amount for a SBA 504 loan is typically around $14 million.
Considering that borrowers can take on several 504 loans for numerous projects, the loan amount can increase to $20 million.
As a company, if you are not interested in getting funding from a CDC, your finest alternative is the SBA 7a loan.
Obtaining 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 funding.
Furthermore, your organization will have to provide additional paperwork on the commercial property that is being funded.
In either case, consider a proper amount for your organization and whether you can meet your lenders’ requirements.
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