SBA 504 Loan Program

HomeSBA 504 Loan Program

Grow Your Small Business with a SBA 504 Loan

Established by Congress in 1986, the SBA 504 Loan Program provides healthy, expanding businesses with long-term, below-market, fixed-rate financing for the acquisition of land and building, machinery and equipment, and construction and renovation.

Download SBA 504 Loan Application

Eligible Businesses

  • Any for-profit businesses—corporation, partnership or proprietorship—are eligible to apply. The business tangible net worth may not exceed $15 million and the net profit after tax may not exceed $5 million.

Ineligible Businesses

  • Not for profits
  • Speculative Developers
  • Insurance Companies
  • Gambling Concerns
  • Private Clubs that restrict membership

Maximum Amount of SBA Participation

  • Up to 40% of eligible cost, with a $5,000,000 maximum
  • Manufacturers and energy efficiency projects are eligible for up to $5,500,000
  • These projects enable unlimited access to SBA funding and the total project size is unlimited

Eligible Use of Funds

  • Purchase of land
  • Construction of building
  • Purchase of building
  • Modernization, renovation or improvement of building
  • Purchase of machinery or equipment with useful life of 10 years or more

Ineligible Use of Funds

  • Working Capital
  • Inventory
  • Rolling Stock

Financing Method

  • Private lender provides 50% of project cost, and SBA 504 Loan provides 40%
  • Equity requirements are at least 10%

Loan Terms

  • Maximum of 40% of project
  • Terms of 20 years for real estate, 10 years for machinery and equipment
  • Fixed, below-market interest rate
  • Total fees of 2.17%, plus an attorney closing fee
  • Fees can be included in the 504 loan amount and financed over a 20-year term
  • Bank Financing
  • CDC/SBA 504 Loan
  • Existing Equity

Sample Financing Breakdown

This breakdown would be for a project with total costs of $1 million:

Entity Loan Amount Percent of Project Term Interest Collateral
Private Lender $500000 50% 10 years Market 1st Mortgage
CDC/SBA $400000 40% 20 years Below Market/Fixed 2nd Mortgage
Business/Borrower $100000 10% n/a n/a n/a

Special Purpose Projects

SBA defines certain properties as special purpose. This list is not intended to be all-inclusive.

  • Car wash business
  • Gas stations
  • Hotels, motels and other lodging facilities
  • Hospitals, nursing homes and assisted living centers
  • Marinas
  • Farms, including livestock and dairy facilities

Sample Financing Breakdown for Special Purpose Projects

This breakdown would be for a project with total costs of $1 million

Entity Loan Amount Percent of Project Term Interest Collateral
Private Lender $500000 50% 10 years Market 1st Mortgage
CDC/SBA $350000 30% 20 years Below Market/Fixed 2nd Mortgage
Business/Borrower $150000 15% n/a n/a n/a

Startup Businesses

The SBA defines startup businesses as those that have been in operation for less than two years.  These businesses are eligible for SBA 504 loans; however, they require an additional 5% down payment. (Financing breakdown is same as table above)

Sample Financing Breakdown for Special Purpose Projects and Startup Businesses

This breakdown would be for a project with total costs of $1 million

Entity Loan Amount Percent of Project Term Interest Collateral
Private Lender $500000 50% 10 years Market 1st Mortgage
CDC/SBA $300000 30% 20 years Below Market/Fixed 2nd Mortgage
Business/Borrower $200000 20% n/a n/a n/a

504 Rate History

NOTE: Estimated pricing published by Eagle Compliance, LLC, the program’s fiscal agent. 25- and 20-year term loans fund every month; 10-year term loans fund every other month. Effective interest rates are inclusive of servicing fees. Servicing fees are subject to credit risk of the applicant. Official monthly SBA 504 effective interest rate tables can be found at Eagle Compliance LLC.

2024

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 6.361% 6.381% 6.281% 6.695% 6.555% 6.354% 6.206% 6.045% 5.765% 6.076%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 6.420% 6.490% 6.360% 6.767% 6.656% 6.445% 6.277% 6.115% 5.833% 6.146%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
10-Year 6.526% 6.526% 6.587% 6.587% 6.908% 6.908% 6.493% 6.493% 5.875% 5.875%

2023

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 6.310% 6.015% 6.334% 5.884% 6.026% 6.334% 6.583% 6.554% 6.812% 7.129% 7.019% 6.590%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 6.282% 5.988% 6.338% 5.956% 6.079% 6.388% 6.637% 6.609% 6.867% 7.180% 7.020% 6.610%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
10-Year 6.433% 6.433% 6.784% 6.784% 6.054% 6.054% 7.076% 7.076% 7.067% 7.067% 7.207% 7.207%

2022

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 3.216% 3.598% 3.929% 4.680% 5.119% 5.191% 5.110% 4.981% 5.440% 6.439% 6.529% 6.110%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 3.070% 3.454% 3.766% 4.620% 5.061% 5.132% 5.051% 4.892% 5.343% 6.362% 6.452% 6.032%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
10-Year 3.070% 3.070% 3.820% 3.820% 4.931% 4.931% 4.974% 4.974% 5.332% 5.598% 6.534% 6.534%

2021

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 2.692% 2.752% 3.043% 3.073% 2.933% 2.883% 2.813% 2.863% 2.973% 2.912% 2.922% 3.026%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 2.653% 2.714% 2.995% 3.016% 2.845% 2.764% 2.694% 2.744% 2.855% 2.765% 2.775% 2.880%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
10-Year 2.438% 2.438% 2.684% 2.684% 2.612% 2.612% 2.591% 2.591% 2.673% 2.372% 2.793% 2.793%

2020

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 3.710% 3.460% 2.878% 3.029% 2.758% 2.597% 2.406% 2.66% 2.406% 2.582% 2.552% 2.622%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 3.639% 3.388% 2.804% 2.955% 2.683% 2.522% 2.341% 2.210% 2.361% 2.553% 2.523% 2.583%

2019

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 4.877% 4.767% 4.737% 4.527% 4.387% 4.086% 4.006% 3.626% 3.455% 3.480% 3.740% 3.640%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 4.751% 4.641% 4.581% 4.360% 4.260% 3.978% 3.908% 3.526% 3.355% 3.398% 3.679% 3.579%

2018

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
25-Year 5.316% 5.346% 5.286% 5.207% 5.317% 4.987%
Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 4.64% 4.94% 4.92% 5.024% 5.214% 5.314% 5.254% 5.294% 5.244% 5.153% 5.253% 4.922%

2017

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-year 4.58% 4.60% 4.83% 4.62% 4.66% 4.59% 4.76% 4.53% 4.37% 4.57% 4.51% 4.50%

2016

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-year 4.82% 4.31% 4.54% 4.30% 4.31% 4.22% 4.08% 4.09% 4.08% 3.99% 4.35% 4.59%

2015

Rate Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
20-Year 4.59% 4.53% 4.79% 4.58% 4.84% 5.05% 4.95% 4.89% 4.89% 4.76% 4.74% 4.86%

We look forward to working with you on SBA 504 financing opportunities.

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