SBA 504 Loans

The CDC/504 Loan Program promotes business growth and job creation. Created in October 1980 its primary focus is to: “Foster economic development, create or preserve job opportunities and stimulate growth, expansion and modernization of small businesses.” 13 C.F.R. 120.800. The loan program is used to finance the acquisition of certain long-term fixed assets/property. 504 loans are available through Certified Development Companies (CDCs), SBA’s community-based partners who regulate nonprofits and promote economic development within their communities. While the vast majority of businesses are eligible for 504 loans, some are not. The maximum maturities for SBA loans are: 25 years, 20 years for real estate, and 10 years for personal property. Typically the loan is structed as follows: 50% of the loan amount is funded by a participating Lender institution; 40% of the loan amount is funded by the SBA; and 10% of the loan amount is funded by the Borrower. Interest rates are pegged to an increment above the current market rate for 5-year and 10-year U.S. Treasury issues. The required documentation to be signed by Borrowers for 504 loan are: the Note, Debenture, Compensation Agreement, Servicing Agent Agreement, Borrower Operating Company Certification, Third Party Lender Agreement, Interim Lender Certification, Equal Opportunity Poster, Guarantees, ACH Authorization, CDC Board Resolution, and CDC Certification. Depending on the Loan criteria, additional documentation may include: a Mortgage, Collateral Assignment of Leases, Security Agreement, Landlord Consents, SBA/CDC Loan Agreement, EPC / OC Resolutions, and/or Trade Name Certificates. For additional information on eligibility criteria and loan application requirements, small businesses and lenders are encouraged to contact a Certified Development Company in your area.


Ocean Bank Center
782 NW Le Jeune Rd

Miami, FL 33126

Phone: (305) 442-1443 Fax: (305) 442-9944

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