California Statewide : What is the SBA 504 Loan Program?

Back to Home | Owners | Lenders | Partners

California Statewide - Call us at 1-800-348-6258

More links:
About Us
Contact Us
504 Rate History
Current Borrower FAQs
Loan Calculator
News & Events
Site Map

What is the SBA 504 Loan Program?

The SBA 504 Loan Program is a partnership program between a Certified Development Company (CDC) and a lender. Working in conjunction with qualified lenders, California Statewide provides up to 90% financing for commercial property purchases and new construction and, normally, does not require additional collateral.

How is an SBA 504 Project Structured?

California Statewide provides up to 40% of the total project cost with an affordable, fully amortized loan. The participating lender normally finances 50% of the cost. You, the borrower, typically puts down as little as 10% of the total project cost.

%	Project Cost	Source of Funds	Interest Rate	Amortization	Collateral
50%	$1,625,000	Private Lender	Fixed or Variable	15 to 30 yrs	1st Trust Deed
40%	$1,300,000	California Statewide	Rate: 4.93% Fixed	20 yrs Fully Amortized	2nd Trust Deed
10%*	$325,000	Business Borrower
Total	$3,250,000
* Start-up OR Special Purpose Building requires 15% equity. Start-up AND Special Purpose Building requires 20% equity.

Why the SBA 504 Loan Program is Right for You.

An SBA 504 loan is a powerful tool to help your business grow. It offers:

90% financing, to preserve working capital for business expansion
Low monthly loan payments by utilizing 15- to 30-year amortization schedules from a First Mortgage Lender
A variety of options for interest rates from a first mortgage Lender
The ability to finance the SBA fees into the loan, reducing up-front cash outlay