CDC 504 Loan Program
Don't Just Dream It . . . Live It!
Alternative Business Capital (ABC) has discovered a little known private and public government loan resource for small and medium enterprises (SME). The Small Business Administration (SBA) Certified Development Corporation (CDC) 504 program is an economic tool for SME, which create the most jobs but are excluded from access to capital markets.
When you expand and grow your business, you benefit;
- the community by creating jobs & expanding the tax base
- employees by providing an opportunity to earn income
- other businesses buy purchasing goods and services from them
- yourself as a leader in the community and a higher than average personal income
- the government through the increase tax base
Goals of the 504 Program
- Create economic development opportunity in the community
- Provide affordable long-term financing for business expansion
- Give a financial incentive to stimulate business capital investment
- Provide access to public capital markets for small business
- Expand women, veteran and minority business development
- Develop
Advantages of the SBA 504 Program
for the Borrower
- Low down payment which preserves working capital
- Most commercial banks will lend 60-70% of the appraised value of project
- Fixed interest rate second mortgage loan
- You never have to worry about rate increases
- Long Term Financing (up to 25 years)
- Longer terms make your monthly payment lower
- Guaranteed through the SBA debentures (bonds)
- Rate of private sector financing with low Loan-to-Value (LTV)
- Less than Perfect Credit is OK
- Collateral usually limited to assets being financed
for the Lender
- Excellent LTV
- The Government as Subordinate Lender
- CDC issues a debenture (Bond) that is 100% guaranteed by SBA
- Less Paperwork and "red tape" than a 7a loan
- 504 first mortgage in secondary market
- May participate in projects that would normally exceed lending limits
- Community Reinvestment Act (CRA) Credits
CDC 504 Loan Size
- $500,000 - $5 Million
The CDC 504 Loan is one of the BEST ALTERNATIVE FINANCING vehicle available for growing small business.
Want to Learn More?
- How to Structure a 504 Loan?
- Qualifications
- Requirements
- Cost and Fees
- Subscribe to our Free Insider's Report
- Contact a Project Manager