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SBA 504 Loan Program

For Manufacturing Companies, either in business or startups, the purpose of the SBA 504 Loan Program is to provide long term below market rate financing for the acquisition of land and building, machinery and equipment and construction and renovation. Established by Congress in 1986, is the first national financing program to recognize contributions of small and medium sized businesses toward local economic development and job growth in the U.S.

  • Financing for fixed assets: real estate, machinery and equipment.
  • Terms of 20 years for real estate, 10 years for machinery and equipment
  • Eligible Borrowers- For profit businesses (corporation, partnership or proprietorship).  Will do Startups and Emerging Businesses
  • Tangible net worth not to exceed $15 million
  • Net profit after taxes not to exceed $5 million during previous 2 years
  • Manufacturers and energy efficiency projects are eligible for up to $5,500,000.
  • 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
  • Equity Requirements
  • Typically 10 percent for Companies in businesses over 24 Months
  • Typically 15% for Startups and Emerging Businesses
  • Terms of 20 years for real estate, 10 years for machinery and equipment. 504 loans are fully amortized.
  • Total fees will vary, but typically no more than 4% plus an attorney closing fee. These fees can be included in the 504 loan amount and financed over a 20-year term.
  • VetLoan Advantage- “The VetLoan Advantage Program reduces the overall fee burden
  • Collateral: Second Mortgage and / or lien on assets purchased with proceeds of 504 loan.
  • Personal Guarantees: Personal guarantees of the principals (ownership of 20% or more) are required. Corporate Guaranties are also required.

SBA 504 VetLoan Program

Veterans have a track record of success as small business owners, surpassing other groups, according to the U.S. Census. NADCO’s VetLoan Advantage program helps veterans get the financing they need for small business ownership and success.

  1. SBA Community Advantage Program offers working capital loans of up to $250,000 for qualified borrowers. Through VetLoan Advantage, discounts and cash rebates of up to $5,000 are available.
  2. The SBA 504 Loan Program provides up to 90% financing for owner-user equipment and commercial/industrial real estate. In addition to a low down payment (typically 10%), borrowers can take advantage of long-term fixed rates. Veteran-owned businesses can take advantage of VetLoan Advantage discounts and rebates worth up to $20,000.

The purpose of the SBA 504 Loan Program is to provide long term below market rate financing for the acquisition of land and building, machinery, equipment, construction and renovation. Established by Congress in 1986, is the first national financing program to recognize contributions of small and medium sized businesses toward local economic development and job growth in the U.S.

  • Financing for fixed assets: real estate, machinery and equipment.
  • Terms of 20 years for real estate, 10 years for machinery and equipment
  • Eligible Borrowers- Veteran Owned For profit businesses (corporation, partnership or proprietorship). Will do Startups and Emerging Businesses
  • Tangible net worth not to exceed $15 million
  • Net profit after taxes not to exceed $5 million during previous 2 years
  • Manufacturers and energy efficiency projects are eligible for up to $5,500,000.
  • 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
  • Equity Requirements
    • Typically 10 percent for Companies in businesses over 24 Months
    • Typically 15% for Startups and Emerging Businesses
  • Terms of 20 years for real estate, 10 years for machinery and equipment. 504 loans are fully amortized.
  • Total fees will vary, but VetLoan programs offer reduced fees and costs. These fees can be included in the 504 loan amount and financed over a 20-year term.
  • Collateral: Second Mortgage and / or lien on assets purchased with proceeds of 504 loan.
  • Personal Guarantees: Personal guarantees of the principals (ownership of 20% or more) are required. Corporate Guaranties are also required.
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