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 Whatcom 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 Whatcom 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 Whatcom 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 integrates a neighborhood advancement corporation in Whatcom County. The loan is ideally suitable for a small business that has an interest in building or purchasing their owner-occupied commercial property.
The program works by bringing two lenders together to fund the purchase of business real estate. Usually, these two lenders are the CDC and a conventional lender or bank.
These arrangements work whereby the bank loans the debtor up to 50 percent, CDC loans up to 40 percent while the customer chips in the 10 percent typically as a cash down payment.
Loan Requirements for a SBA 504 Loan
There are 2 main requirements that your business in Whatcom County WA should meet in order to get approved for a SBA 504 loan. These consist of having a credit history 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 needed financing form other source or be involved in the property rental investment.
Your business in Whatcom County WA will have to have a significant net worth of less than $15 million, have the capability to make the loan repayment on time from the expected operating cash flow from business as well as 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 tenancy of the area while renting the remaining 49 percent.
Loan Terms and Interest Rates
The two various types of loan— from the bank and the CDC– that comprise the SBA 504 Loan usually have various terms, limits, rates, and fees.
The rates integrated make up the overall loan rate on your CDC/SBA 504 Loan.
Usually, your company will pay an interest rate of in between 4 and 6 percent on the whole loan with a payment length of 25 years.
The SBA sets a limitation on the terms, fees and rates 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 not do the same for the traditional lenders such as banks or other banks which leaves space for settlements 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.
Because borrowers can take on numerous 504 loans for multiple projects, the loan amount can increase to $20 million.
As an organization, if you are not interested in getting funding from a CDC, your best alternative is the SBA 7a loan.
Obtaining a SBA 504 Loan
The SBA 504 loan application resembles that of the SBA 7a loan in regards to the amount of time and paperwork needed to get the funding.
Additionally, your company will need to provide extra paperwork on the property that is being funded.
In either case, consider an appropriate amount for your company and whether you can meet your lenders’ needs.
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