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19 Mar 2015
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What is an SBA 504 Loan?

The US Small Business Administration (SBA) created the 504 loan program in 1980 to provide accessible financing for growing businesses that seek owner-occupied commercial real estate.

 

The funds in a 504 loan can be used for the following:

• Acquisition of an existing building (51% occupancy)

• Building expansion or renovations

• Equipment

• Fixed assets from business acquisition

• Land and new construction

 

The 504 program as the following goals:

• Job creation

• Expansion of lending to women, minorities, and veterans

• Assisting US manufacturing

• Rural and undeserved area development

• Expansion of lending to businesses that "Go Green"

 

The Go Green qualifications are:

• LEED certified buildings

• Projects that reduce energy consumption by at least 10%

• Projects that generate renewable energy

• Qualify for purchase of multiple properties (no cap)

• Unlimited total project cost (SBA portion capped at $5.5 million)

 

Borrower contribution expected to be:

• As little as 10% down payment for most loans

• 15% for start-up businesses (within 2 years) or special use properties

• 20% if project is a start-up and a special-use property.

 

Are you qualified?

• Private, for-profit businesses in the US

• Business net worth less than $15 million

• Business net profit after tax (2 year average) no more than $5 million

• Seeking financing for equipment or an owner-occupied building (minimum 51%)

 

If you are curious whether an SBA 504 loan is right for you, please give us a call at 281-488-2022.  One of our experienced Business Consultants will give you a free initial consultation.

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1120 Bay Area Blvd. Houston, TX 77058
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