Why choose SBA?
Many successful companies have used SBA loans in order to obtain more favorable financing terms than were otherwise available. Many of today's biggest names – such as Apple Computer, Callaway Golf, Federal Express and Nike – were assisted in their early years by programs of the Small Business Administration.
The SBA loan guarantee programs are among the most widely used tools in business financing today. Once perceived as a federal bureaucracy catering only to the economically disadvantaged, today's SBA programs actually enable many successful small and medium sized businesses to grow by borrowing on more favorable terms than they could obtain on their own.
There are many reasons why you should use a 504 Loan. Key reasons are:
Low Down Payment & Low Fees
Financing of up to 90% of project cost, enabling the small business to have liquidity for working capital. And the 504 loan fees are still the lowest on the market compared to 7(a) and other SBA loans.
Long Term Financing & Fixed Rates
Up to 25 year fully amortized loan terms available and the interest rate on the note remains the same through the term of the loan. SBA 504 loans are funded by monthly bond (debenture) sales to investors on Wall Street, therefore creating more competitive interest rates.
504 Government Backed Program
was created to increase the ability for small businesses to purchase business properties to assist the local communities economic state. A business owner may purchase the real estate or machinery for the business and get a tax benefit and add value to the real estate, while taking advantage of locking in occupancy costs for 25 years.
Own Your Business
Stop paying rent and invest by owning your own building. Once the SBA 504 loan is paid off, a business can earn revenue by renting the space out to other businesses for a profit.
Maximize Tax Benefits
By purchasing and holding title to a building in the name of the business or as a holding company for the real estate. Minimize the liability of the business and the business owner. The options may be to combine a couple or more small businesses and receive one loan if it suits them best.
Most small businesses under $15 million are eligible for a 504 loan for real estate or equipment needs. Including Projects up to $5,500,000 of 504 financing.
Facts & Myths about SBA Loans
Applicants frequently have misconceptions about using government programs to help their businesses. The true facts about SBA guaranteed lending are set forth below.
- SBA guarantees loans that are the highest risk.
- The government wants to run the business.
- Loans are primarily for minorities and economically disadvantaged groups.
- SBA is the lender of last resort.
- Loan guarantees are based on the same criteria used by the lenders
- The government's credit, not government's business skills, is what the lenders want
- Loan guarantees are issued without regard to race, creed, origin or sex
- Guarantees go to businesses that need some help, not to ones who do not.