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 Pierce 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 Pierce 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 Pierce 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 includes a neighborhood development corporation in Pierce County. The loan is ideally ideal for a small company that is interested in building or purchasing their owner-occupied commercial property.
The program works by bringing 2 lenders together to fund the purchase of commercial real estate. Typically, these two lenders are the CDC and a standard lender or bank.
These plans work whereby the bank loans the customer up to 50 percent, CDC loans up to 40 percent while the customer chips in the 10 percent normally as a cash deposit.
Loan Requirements for a SBA 504 Loan
There are 2 main requirements that your company in Pierce County WA should meet 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 deposit for the project.
Besides the two, you will need to not have the required financing form other source or be associated with the real estate rental financial investment.
Your organization in Pierce County WA will have to have a substantial net worth of less than $15 million, have the capability to make the loan repayment on time from the anticipated operating capital from business along with occupy 51 percent of the building.
SBA 504 loans are therefore perfect for any company that is interested in the purchase of industrial property and can ensure 51 percent occupancy of the area while renting out the remaining 49 percent.
Loan Terms and Interest Rates
The two different types of loan— from the bank and the CDC– that make up the SBA 504 Loan generally have different terms, limitations, rates, and costs.
The rates integrated comprise the total loan rate on your CDC/SBA 504 Loan.
Usually, your company will pay a rate of interest 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, costs and rate of interest that is given by the CDC which covers 40 percent of the entire 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 traditional lenders such as banks or other financial institutions which leaves space for settlements for the loans.
Nevertheless, the rate 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.
Given that borrowers can take on numerous 504 loans for multiple reasons, the loan amount can increase to $20 million.
As a company, if you are not interested in getting funding from a CDC, your finest option is the SBA 7a loan.
Getting a SBA 504 Loan
The SBA 504 loan application resembles that of the SBA 7a loan in regards to the amount of time and documents needed to get the financing.
Furthermore, your company will have to provide extra documents on the commercial property that is being funded.
In any case, consider a proper amount for your company and whether you can satisfy your lenders’ requirements.
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