504 Loan Program
You are looking to grow your small business but need the right loan to help you get started. A 504 Loan Program maybe the small business loan you are looking for that provides long-term, fixed-rate financing to acquire major fixed assets for expansion or modernization.
Features & Benefits
Eligible Businesses and Property Types
Almost any type of for-profit business is eligible. Commercial real-estate must be partially occupied by borrower and includes, but is not limited to, the following types of properties:
- Commercial Real Estate (multi use and single use properties)
- Gas Stations (franchise only)
- Franchise Restaurants
- Auto Repair / Maintenance Facilities
- Limited Service Hotels (franchise only)
- Assisted Living Facilities
- Medical / Dental / Veterinary Offices
Requirements & Fees
Terms
- Financing available on projects up to $14,000,000.
- BancorpSouth Bank typically provides a first mortgage of up to 50% of the total loan-to-value.
- This loan can range from $250,000 to $7,000,000.
- The SBA, through a Certified Development Company (CDC) provides up to 40% loan-to-value in a second lien position. This loan can range from $250,000 to $5,000,000.
Interest Rates
- First Mortgage - up to 25-year term for real estate loan and up to 15-year term for equipment purchase with fixed and variable interest rates available.
- Second Mortgage - up to 20-year term for real estate and up to 15-year term for equipment purchase. Fixed rate is determined at SBA guaranteed 504 debenture sale.
Fees
- First Mortgage - fees are always market competitive.
- Second Mortgage - 2.75% + legal review fee. This fee is financed in the loan.
- Fees also include customary closing costs, construction loan fees (if applicable), and bridge fees.
Eligible Properties
- Most for-profit businesses are eligible for financing. Commercial real estate must be 51% or greater owner occupied.