Learn about DRDA's latest news and information for you and your business.

19 Mar 2015
back to blog
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.

back to blog
Powered by CuteNews

Let us improve your future

Contact us

Contact us

Thank you

We will be in touch soon!

Contact Us

Houston Office
1120 Bay Area Blvd. Houston, TX 77058