SBA 504 Loans and  SBA 504 Refinance Loans

Government Guaranteed Loans Benefits



SBA 504 – Loans

As a small business owner, you may be interested in learning more about this financing option offered by the Small Business Administration (SBA) to help small businesses purchase fixed assets like buildings or equipment.

Eligibility Criteria

To be eligible for an SBA 504 loan, your business must meet certain criteria. These include:

  • Being a for-profit company operating in the United States or its possessions
  • Having a tangible net worth of less than $15 million
  • Having an average net income of less than $5 million after federal income taxes for the two years preceding your application

Additionally, the loan proceeds must be used to purchase fixed assets that will be used for business purposes.

How it Works

SBA 504 loans are provided through Certified Development Companies (CDCs), which are nonprofit organizations that partner with the SBA to promote economic development in their communities. The loan program provides long-term, fixed-rate financing for major fixed assets like equipment or real estate.

The loan is typically structured as follows:

50% of the project cost is financed by a commercial lender

40% of the project cost is financed by a CDC through an SBA-guaranteed debenture

The borrower provides a down payment of at least 10% of the project cost

The interest rates on SBA 504 loans are typically lower than those on conventional loans, and the loan terms can be as long as 25 years.


One of the key benefits of SBA 504 loans is that they provide long-term, fixed-rate financing for major fixed assets, which can help small businesses grow and expand. Additionally, the interest rates on SBA 504 loans are typically lower than those on conventional loans, making them a more affordable financing option for small businesses.


SBA 504 loans are a valuable financing option for small businesses looking to purchase fixed assets and grow their businesses. With their long-term, fixed-rate financing and lower interest rates, these loans can help small businesses achieve their growth and expansion goals.

SBA 504 Refinance Loan Program

If you want to refinance your commercial mortgage, an SBA 504 refinance is a great business loan option. You’ll get a longer repayment term, a fixed interest rate, and even have an opportunity to cash out equity in the building to help your business grow! New SBA 504 refinance guidelines make it even easier to qualify for the program, as long as your existing debt is eligible.


  • Long-term repayment schedules, from 10-25 years (depending on the specifics of your loan), compared to more typical 5-10 year terms.
  • Below-market, fixed interest rates for the life of the loan, making it easier to plan and budget for your business.
  • Lower owner-equity requirements, with financing up to 85-90%.

If you’re interested in learning more about SBA 504 loans and whether you’re eligible, contact DFN to get started.