This program is designed for the acquisition of a business with real estate or for the acquisition of real estate by a business.
CDC/504 SBA loans fees can sometimes be financed with the loan.
Also, be aware that you’ll need to put around 10% of your purchase down to secure 504 SBA financing.
Typically, the prime rate, plus 2.75%.
The 504 loan program involves two individual loans—one from a bank (which is 50% of the loan) and one facilitated by a Certified Development Corporation (which is usually 40% of the loan). The latter gets grouped together when all CDCs pool their projects, and through underwriters, auction the pool to investors.
The loan is amortized monthly over a period of 10 and 25 years, with no prepayment penalty.