The SBA 504 loan program was developed to encourage healthy businesses to expand and create jobs by helping them access favorable fixed asset financing. The program offers many advantages for financing real estate and equipment while allowing you to keep working capital in your business so it can continue to grow.
- Low down payment—typically only 10%
- Low, fixed interest rate
- 10, 20 or 25-year terms—no balloon payments
- SBA loan fees are financed in the project
SBA 504 loans can be used to finance the following:
- Land acquisitions and construction of a new facility
- Purchase and renovation of an existing building
- Purchase of equipment
- Refinance existing debt as part of an expansion
- Refinance owner-occupied real estate and equipment
- Permits, impact fees, architectural fees, soft costs and lender loan fees
Capital Matrix works in participation with the lender of your choice to provide the financing you need.
Typical Structure is 50-40-10
| SBA 504 Loan Structure Example | |
|---|---|
| 50% Bank/Credit Union | $1,000,000 |
| 40% SBA | $800,000 |
| 10% Equity | $200,000 |
| Total Project Cost | $2,000,000 |
- You will have 2 loans the lender, and the SBA loan
- Term and loan fees on the lender financing would be negotiated with the lender
- The SBA loan is fully amortized up to 25 years
- The interest rate on Capital Matrix's financing is determined by the sale of SBA-guaranteed debentures; rates are fixed for the life of the loan (up to 25 years).
For more information on loan structure, click here
SBA 504 Fact Sheet