Business Financing

Lenders

Let Us Partner with You to Finance Small Business Loans

We’re large enough to be SBA 504 experts and small enough to care about your project.

Advantages of using SCED
  • Expertise in originating and servicing SBA 504 loans since 1991
  • No hand offs – the loan will stay with the same loan officer from initial application to approval to closing
  • Additional funding availability – under certain circumstances SCED's business loan program can be combined with an SBA 504 to provide additional capital.
  • No loan packaging deposit
  • 48-hour pre-qualification
  • We’re a small, but knowledgeable team
  • Lender support via phone, text and email
  • Ability to turn loans quickly, fastest underwriting around – ability to accommodate rush projects
What is eligible for a SBA 504 loan? An SBA 504 loan can be used to purchase commercial buildings, equipment and land.
  • View Full List of Eligible Project Costs
    • Land & Necessary Land Improvements
      • Grading
      • New streets, including curbs and gutters
      • Parking lots
      • Utilities
      • Landscaping
    • Building & Building Improvements
      • Façade expenditures
      • Heating
      • Electrical
      • Plumbing
      • Roofing
    • Refinance
    • Machinery & Equipment
      • Purchase
      • Transportation
      • Dismantling
      • Installation
    • Furniture & Fixtures
    • Professional Fees
      • Engineering costs
      • Appraisal report
      • Environmental Report

SBA 504 Refinance Information
  • View More Information
    • Borrower Advantages
      • Improves Cash Flow: Re-amortizing the loan lowers the payment, increasing cash flow that can be used by the borrower to grow business. Up to 90% LTV when refinancing for rate and term.
      • Cash Out – Tap the Equity Borrower can access up to 85% LTV of their property value and get cash out for eligible business expenses.
      • Access Low Fixed Interest Rates: The SBA 504 is “Main Street’s Window to Wall Street” and borrower is able to access low, fixed 20-year interest rates.
      • Loan Coming Due?: Balloon coming due and worried about finding a home for the loan? SBA 504 provides an attractive refinance solution.
    • Lender Advantages
      • Reduces Exposure: Approvals are easier with a 50% LTV bank loan and SBA behind you in second position.
      • Frees Up Lending Availability: Refinancing an existing borrower can free up opportunities for you to lend to them again.
      • Marketing Opportunity: Grow Your Portfolio - Finding deals in this market can be difficult, ask us how the 504 refinance can grow your portfolio.
      • Project Based on 90% of Appraised Value (85% for Cash Out): Refinance existing property debt or pull cash out of the property - SBA 504 Refinance can do both.
      • No “Extra” Injection for Special Use Properties: Hotels, motels, mini-storages, restaurants and all special use properties are eligible for 90% LTV financing.
      • Borrower Contribution is Equity: In most cases, the borrower will not have to come out-of-pocket with cash as long as they have equity.
      • We Want You to Succeed: Need help with an eligibility question or how to structure a project? Need us to meet with you and your borrower? We support you in person, via phone, text and email.
    • Eligible Businesses
      • For profit business in operation for at least 2 years at time of application
      • No change in ownership in prior 2 years
      • Must occupy at least 51% of project real estate
      • Job requirements are the same as normal 504 program
    • Technical Refinance Information
      • Qualified Debt
        • Every 504 Refinance must have Qualified Debt
        • Originated at least 2 years prior to application
        • 85% of more of the original debt must have been used for 504-eligible purposes: to acquire land & buildings, construct or renovate buildings, or purchase equipment
        • Subsequent refinancing, including cash out, of the original debt is permitted
        • Payments current for prior 12 months (less than 30 days past due)
      • Other Secured Debt
        • Debt secured with the same asset as Qualified Debt and payments current for prior 12 months (less than 30 days past due)
      • Business Operating Expenses
        • Any other secured or unsecured liability and/or future business expenses to be incurred in the next 18 months (i.e. cash out)
    • 90% LTV Project Structure
      • 90% LTV when refinancing Qualified Debt and Other Secured Debt
      • Project structure is based on appraisal
      • Loan approval can be made subject to appraisal
      • Borrower’s 10% equity represents equity in the project assets, other collateral or cash
    • 85% LTV Project Structure
      • 85% LTV when refinancing includes Business Operating Expenses
      • Business Operating Expenses cannot exceed 25% of refinance project (i.e. appraised value)
      • Project structure is based on appraisal
      • Loan approval can be made subject to appraisal
      • Borrower’s 25% equity represents equity in the project assets, other collateral or cash
    • A Loan is Not Eligible for Refinance If . . .
      • Loan with a federal guarantee (e.g. 7(a), 504, USDA)
      • Third Party Loan on an existing 504 project
      • Debt to be refinanced is owed to an Associate of the Borrower
      • The existing creditor is in a position to sustain loss and refinanced would shift all or part of the potential loss to SBA

Have a borrower maxed out on SBA eligibility? Use the SBA 504 Green Loan program to get more SBA eligibility.
  • View SBA 504 Green Loan Program Details
    • By going through the SBA 504 Green Loan program borrowers get an additional $5 million in SBA loan funds for every Green Loan project.
    • An energy audit is conducted by an independent third party to calculate total building energy usage. Borrower will need to be able to generate 10% of the total building energy usage from renewable systems (i.e. solar panels). We submit the third party report with a bid from a renewable energy installer with our application.
    • The quote from the renewable energy installer would be an eligible project cost added under purchase/install equipment.
    • This is extremely helpful when dealing with borrowers who currently have one or two hotels and are maxed on SBA eligibility and want to purchase another hotel.
    • For every Green 504 loan the borrower gets up to $5 million in new SBA loan funds.

What types of businesses are not eligible for 504 financing? The SBA has a determined that a variety of businesses are not eligible for financing.
  • View Full List
    • Non-profit businesses (for profit subsidiaries are eligible);
    • Financial businesses primarily engaged in the business of lending, such as banks, finance companies, and factors (pawn shops, although engaged in lending, may qualify in some circumstances);
    • Passive businesses owned by developers and landlords that do not actively use or occupy the assets acquired or improved with the loan proceeds (except Eligible Passive Companies);
    • Life insurance companies;
    • Businesses located in a foreign country (businesses in the U.S. owned by aliens may qualify)
    • Pyramid sales distribution plans;
    • Businesses deriving more than one-third of gross annual revenue from legal gambling activities;
    • Businesses engaged in any illegal activity;
    • Private clubs and businesses which limit the number of memberships for reasons other than capacity;
    • Government-owned entities (except for businesses owned or controlled by a Native American tribe);
    • Businesses principally engaged in teaching, instructing, counseling or indoctrinating religion or religious beliefs, whether in a religious or secular setting;
    • Consumer and marketing cooperatives (producer cooperatives are eligible);
    • Loan packagers earning more than one third of their gross annual revenue from packaging SBA loans;
    • Businesses with an Associate who is incarcerated, on probation, on parole, or has been indicted for a felony or a crime of moral turpitude;
    • Businesses in which the CDC or any of its Associates owns an equity interest;
    • Businesses which present live performances of a prurient sexual nature; or derive directly or indirectly more than 5% of their gross revenue through the sale of products or services, or the presentation of any depictions or displays of a prurient sexual nature;
    • A business or applicant involved in a business which defaulted on a Federal loan or federally assisted financing resulting in a loss to the government. A compromise agreement shall also be considered a loss;
    • Businesses primarily engaged in political or lobbying activities; and
    • Speculative businesses (such as oil wildcatting).

What is considered a special-use facility? A special-use building requires an additional 5% down payment.
  • View Comprehensive List of Special-Use Facilities
    • Amusement parks;
    • Bowling alleys;
    • Car wash properties;
    • Cemeteries;
    • Clubhouses;
    • Cold storage facilities where more than 50% of total square footage is equipped for refrigeration;
    • Dormitories;
    • Farms, including dairy facilities;
    • Funeral homes with crematoriums;
    • Gas stations;
    • Golf courses;
    • Hospitals, surgery centers, urgent care centers and other health or medical facilities;
    • Hotels, motels, and other lodging facilities;
    • Marinas;
    • Mines;
    • Museums;
    • Nursing homes, including assisted living facilities;
    • Oil wells;
    • Quarries, including gravel pits;
    • Railroads;
    • Sanitary landfills;
    • Service centers (e.g., oil and lube, brake or transmission centers) with pits and in ground lifts;
    • Sports arenas;
    • Swimming pools;
    • Tennis clubs;
    • Theaters; and
    • Wineries

What are the Fees Associated with a SBA 504 Loan?

  • View SBA 504 Loan Fees
    • Fees financed in the SBA 504 loan
      • SBA fees – 2.20% of the SBA loan amount (approximate)
      • Attorney fee - $2,500
    • Fees paid by the borrower
      • Title & Escrow – Depends on the size of the project
      • Attorney Opinion Fee - $750
      • Tax Service Fee - $55
      • Appraisal Report
      • Environmental Report
    • Fees paid by the bank
      • SBA Participation Fee - 50 basis points on the PERMANENT (bank’s 1st deed of trust) loan

Current SBA 504 Loan Rates

10-Year Fixed Rate 4.50%
20-Year Fixed Rate 4.77%
Refinance Rate 4.80%
Loan Rate Pricing Changes Monthly

Business Financing Success Stories

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