How it works
The SBA 504 program supports qualifying fixed assets through a structure involving a Certified Development Company and a third-party lender. Project eligibility and borrower contribution requirements need to be assessed as a complete transaction.
Where it can fit
Think of longer-lived business assets such as qualifying commercial property and equipment. The project budget should distinguish the asset purchase from operating cash, because a fixed-asset program is not a general-purpose revolving working-capital facility.
Look closely at the trade-offs
Confirm occupancy, project, ownership, and other current program requirements with a CDC. Fees, appraisals, environmental review, closing conditions, and interim financing can affect the project’s timetable and cash needs.
Your next-step checklist
- Complete project budget
- Property or equipment details
- Borrower contribution evidence
- CDC and lender requirements
Crack this combination.
What is the central focus of 504 financing?
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Sources & further reading
This file draws on the following references. Product availability and requirements must be confirmed with the provider.
SBA: 504 loans