What's SBA 504?

SBA 504 provides long terms and low rates for major fixed assets such as real estate, equipment or both that promote business growth and job creation.  504 loans are available through CDC(Certified Development Company) which is certified and regulated by SBA. 40% of the loan usually comes from CDC, 50% from a bank and 10% from you, the business owner.


​When you buy a commercial property with a commercial mortgage, it requires a larger down payment 35%-60% and shorter terms like up to 10 years.  SBA 504 is a great program for business owners to accumulate assets through the businesses they have.

  • Low rate: 3%-6% APR
  • Must be owner occupied 51% or more of space
  • 10% Minimum down payment 
  • 15% down payment for less than 2 years in business
  • 20% down payment for specialty properties
  • Loan amount: $500,000 to $5,000,000
  • Term: 20 years
  • Possible to convert a commercial loan to SBA 504
  • Equipment and renovation cost can be added


<Pre Qualifications>

-Minimum credit 700

-Under $15 million in tangible assets, $5 million net annual income

-Only for profit businesses

-3 recent years of personal & business tax returns

-Year to Date; profit & loss statement, balance sheet


SBA 504:

​Real Estate Loan

  • 10% minimum down payment
  • Must be 51% or more owner occupied
  • Equipment & renovation costs can be added
  • ​Term: 20 years



SBA Loans: 7a & 504 

SBA 7a

Business Loan

  • For any business use
  • Pay off existing debt
  • Equipment purchase
  • Term: 10 years


What's SBA 7a loan?

This is the most common SBA loan for businesses. Small Business Administration (SBA) does not give loans to businesses directly.  SBA gives a guarantee 70% - 85% to the bank for a business in case the business defaults on the loan, so the bank can give low rates and longer terms since it's guaranteed by SBA.

  • Rate 4%-7% APR
  • Express: up to $350,000
  • Amount up to $5,000,000
  • Term: 10 years or 20 years


<Pre Qualifications>

-Minimum credit fico 650

-Minimum of 2 years in business

-Must be a US citizen or a permanent resident

-No bankruptcies or foreclosures within the last 3 years

-No outstanding tax liens

-No delinquencies or default on any government loan

-Minimum annual revenue $300,000 and more

-Maximum tangible asset $15 million, under $5 million annual net income


<Required Documents>

-Recent 2 years of personal & business tax returns

-Year to Date; profit & loss, balance sheet

-Debt schedule

-6 recent months bank statements

-Processing time: 2-12 weeks