SBA 504 Loan – Must be used for fixed assets (and certain soft costs), including:
Purchasing existing buildings.
Purchasing land and land improvements.
Construction of new facilities or renovating existing facilities.
Purchasing long-term machinery.
Refinancing of debt in connection with an expansion of the business through new or renovated facilities or equipment.
504 Loans are typically structured with SBA providing 40% of the total project costs, a participating lender covering up to 50% of the total project costs, and the borrower contributing 10% of the project costs. Under certain circumstances, a borrower may be required to contribute up to 20% of the total project costs.
SBA 7(a) Community Advantage Loan – Up to $250,000 for:
Existing as well as startup businesses are eligible.
Must be a business with limited financial resources or located in an undeserved community.
Purchasing inventory, equipment, working capital, etc.
Rates start at prime plus 3%.
Terms of up to 25 years.
No prepayment penalty.
SBA Micro Loan – Up to $50,000 for:
Existing as well as startup businesses are eligible.
Purchasing inventory, equipment, working capital, etc.
Interest rate starts at 6% fixed at closing for the life of the loan.
