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 Yakima 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 Yakima 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 Yakima 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 development corporation in Yakima County. The loan is ideally suitable for a small business that has an interest in building or buying their owner-occupied business real estate.
The program works by bringing two lenders together to fund the purchase of industrial real estate. Usually, these two lenders are the CDC and a conventional lender or bank.
These plans work where the bank loans the borrower as much as 50 percent, CDC loans up to 40 percent while the debtor chips in the 10 percent normally as a cash deposit.
Loan Requirements for a SBA 504 Loan
There are 2 main requirements that your organization in Yakima County WA should satisfy in order to qualify for a SBA 504 loan. These include 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 need to not have the needed funding form other source or be associated with the property rental financial investment.
Your company in Yakima County WA will have to have a considerable net worth of less than $15 million, have the ability to make the loan repayment on time from the anticipated operating cash flow from the business in addition to inhabit 51 percent of the building.
SBA 504 loans are therefore ideal for any company that has an interest in the purchase of industrial property and can guarantee 51 percent tenancy of the area while leasing the remaining 49 percent.
Loan Terms and Interest Rates
The two different 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 overall loan rate on your CDC/SBA 504 Loan.
Normally, your organization 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 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 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 conventional lenders such as banks or other banks which leaves room for settlements for the loans.
However, the rate of interest are generally in 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 several 504 loans for several projects, the loan amount can increase to $20 million.
As a company, if you are not interested in getting funding from a CDC, your best alternative is the SBA 7a loan.
Requesting a SBA 504 Loan
The SBA 504 loan application resembles that of the SBA 7a loan in regards to the amount of time and documentation needed to get the funding.
Additionally, your company will have to provide extra documentation on the property that is being funded.
In either case, consider a suitable amount for your company and whether you can fulfill your lenders’ needs.
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