No Balloon Payments
Interest Rate History
SBA 504 loans have a fixed interest rate and are fully-amortizing loans with no balloon payments. Terms available are 10 years, 20 years, or 25 years.
For December 2020, the effective interest rate for a 25 year loan is 2.47%. The effective interest rate for a 20 year loan is currently 2.43%. The Bank Prime Rate is 3.25% for comparison.
While 20 & 25 year debentures are sold every month, 10 year debentures are sold every other month. The most current sale of 10 year debentures is November 2020, and the effective interest rate is 2.24%.
SBA 504 Fact Sheet