The SBA 504 was established to offer small businesses access to long-term fixed asset financing at a low interest rate to encourage small business growth in our declining economy it was suppose to be temporary. However I would as well as many others in our industry like to see this loan product continue, we are not out of the woods yet.
The benefits to the business owner are savings with a lower interest rate but also if there is more than 10% equity they can get working capital for eligible business expenses. Growing our economy is crucial and small business growth is key to jobs. The 50 million in SBA504 loans as of Feb 2012 created over 2 million jobs. That is growth we need to continue. Here are some basic guidelines for qualifying.
- Income restrictions due apply; net worth cannot be more than $15 million and average net income of $5 million or less after federal income taxes for the preceding two years from application
- The small business must be occupied at least 51% of the property at the time of application
- The property must have been acquired at least two years prior to application
- The loan must be current and no late payment of 30 day or more in the last 12 months
- Property is based on current appraised value
- Up to 90% of current appraised value may be financed
- No Nonprofits are allowed under this program
- If you want more information about the SBA 504 loan products go to;
OR just call me!
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ACMC Loan Consultant