SBA-504 LOAN SBA 7(a) LOAN
LOAN SIZE Minimum – $125,000 Maximum – $10 million Minimum – $50,000 Maximum – $5 million
INTEREST RATE • Fixed • Predominantly variable; some fixed-rate options
TERMS • 20 years – real estate • 10 years – equipment • Up to 25 years – real estate • Up to 10 years – business acquisition, equipment • 5 to 7 years – working capital • Weighted average for mixed-use requests
LTV Up to 90%DOWN PAYMENT • 10% borrower • Minimum 10% borrower(often more)Up to 90%

PROPERTY TYPES Office Buildings, Warehouses, Industrial Buildings, Manufacturing, Child Care Facilities, Car Wash Facilities, Automotive Repair, Shops, Professional Buildings, Hotels and Motels, Restaurants, Gas Stations, Bed and Breakfasts, Franchises, Start-ups, Single-Use Buildings

 SBA-504 LOAN  SBA 7(a) LOAN
ELIGIBLE BUSINESS SIZE • Business net worth not to exceed $15 million • Average net profit after taxes for 2 consecutive years not to exceed $5 million • Determined by industry type • Annual sales not to exceed range of $750,000 to $33.5 million for retail, service and agriculture • Number of employees not to exceed range of 100 to 1,000 for wholesale and manufacturing
LOAN STRUCTURE • 50% bank loan • 40% CDC loan • 10% borrower down payment • Loan structure negotiable; dependent on risk • 10% down payment (minimum)
PROCEEDS USE • Purchase existing building • Land acquisition and ground-up construction (can include soft cost development fees) • Expansion of existing building • Finance building improvements • Purchase equipment • Expand, acquire or start a business • Purchase or construct real estate • Refinance existing business debt • Buy equipment • Provide working capital • Construct leasehold improvements • Purchase inventory
PROGRAM REQUIREMENTS • 51% owner occupancy for existing building • 60% owner occupancy for new construction • Equipment must have minimum 10-year economic life • 51% owner occupancy for existing building • 60% owner occupancy for new construction • All assets financed must be used to the direct benefit of the business
COLLATERAL • Generally, project assets being financed are used as collateral • Personal guaranties of the principal owners of 20% or more ownership are required • Subject assets acquired by loan proceeds • Pledge of personal residence unless bank can justify why unnecessary • Personal guaranties of the principal owners of 20% or more ownership are required
FEES • Fees are financed in the 504 loan • Fees are negotiated for the 50% bank loan • Servicing fee (lowest allowed by SBA) for CDC plus a legal review fee • Fees can be financed in the 7a loan • Fees vary with the size of loan paired with 504 loan • Additional .25% charged on any loan portion above $1 million
Closing Time: As soon as 45 days As soon as 45 days