The CDC/504 Loan Program provides long-term, fixed rate financing for major fixed assets that promote business growth and job creation.
504 loans are available through Certified Development Companies (CDCs), SBA’s community-based partners who regulate nonprofits and promote economic development within their communities. CDCs are certified and regulated by the SBA.
The maximum loan amount for a 504 loan is $5 million. For certain energy projects, the borrower can receive a 504 loan for up to $5.5 million per project, for up to three projects not to exceed $16.5 million total.
What you’ll need to Qualify
- 680+ FICO score for all primary business owners.
- 10% down payment if purchasing a business or commercial real estate
- Collateral: While collateral is not a requirement, the more collateral you can put up, the more likely it is you will get a loan
- Must have been in business for 2 years or more. It is possible for startups to get a CDC/504 Loan (as opposed to a 7(a) loan), however you will need all of the above plus be able to prove business management and industry experience.
- Your business must be profitable
- You may not have any delinquencies or defaults on record, including student loans
- If purchasing commercial real estate, your business must occupy at least 51% of the building.
- If building new commercial real estate, your business must occupy at least 80% of the building.