Small Business Administration 504 (SBA 504)

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SBA 504 Program Summary

  • Small Business Loans
  • Provide growing businesses with long-term, fixed-rate financing for major fixed assets, such as land, buildings and equipment
  • Available to most for-profit businesses for qualified projects that result in the creation or retention of jobs
  • Administered through a partnership with the EDC Finance Corporation

Eligible Businesses

Sole proprietorships or small businesses (tangible net worth <$15 million and 2-year average net income <$5 million) including:

  • Most for-profit, small businesses (500 employees or fewer)
  • Agriculture production

Uses and Purposes of Funding

  • Land and building acquisition
  • Building construction and renovation
  • Purchasing/upgrading long-term machinery and equipment


  • Loans up to $5,000,000 or 40% of total eligible project costs, whichever is less
  • Loans up to $5,500,000 for certain qualifying projects
  • Loans up to $5,500,000 for manufacturers

Interest Rate

  • Market interest rate (average rates based on 5 and 10-year Treasury notes plus a fixed rate spread)


  • 25-year fixed rate term for real estate
  • 20-year fixed rate term for real estate
  • 10-year fixed rate term for machinery and equipment
  • 10% equity required
  • 15% equity required for start-up projects

Job Creation and Retention

  • Create or retain one full-time job for every $65,000 borrowed, $100,000 for manufacturers


  • 7% commitment and underwriting fee (debenture funded)
  • 5% participation fee based on first mortgage loan amount (out-of-pocket)
  • $3,000 closing cost and recording fees (debenture funded)