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"August Effective Debenture Rate is 4.93%”
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FEATURES AND BENEFITS
• Lower down payment: allows a business to conserve valuable operating capital by injecting just 10% of the total project cost. Down payment June vary with project type.
• Fixed interest rate: borrower reduces interest rate risk for 20 years on real estate loans and 10 years on equipment loans.
• Interest rate is competitive and usually below market
• All project costs can be financed: including acquisition (land and building, land and construction of building, renovations, machinery and equipment) and soft costs such as title insurance, appraisal, environmental and bridge loan fees. Other relevant closing costs may be financed.
• Projects from $250,000 to $10,000,000 make good 504 candidates: The maximum SBA guarantee under normal conditions is now $1,500,000. Maximum increases to $2,000,000 if a project satisfies a public policy goal and can extend as high as $4,000,000 if project involves a manufacturer.
SAMPLE PROJECT
Eligible Project Costs:
Purchase Land |
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New Construction |
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Machinery & Equipment |
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Misc. Soft Costs & Fees |
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Total Project Costs |
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Financing Structure:
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Amount |
% |
Rate |
Term |
Monthly Payment |
Bank Loan |
$1,300,000 |
50% |
8.20% |
20 |
$10,873 |
SBA 504 Loan |
1,040,000 |
40% |
6.65% |
20 |
$7,725 |
Down Payment |
260,000 |
10% |
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Total Financing |
$2,600,000 |
100% |
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$18,602 |
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*Note: Participating lenders interest rate most often tied to a Treasury Market Constant Maturity (1yr., 3yr., or 5yr.) plus a spread ranging from 200 bp to 300 bp (Effective debenture rate is equivalent to an average rate over four five year intervals – fixed at time of debenture funding)
For more information about 504 loans, please call Kim Willis at (425) 787-6100 or send an email to kimwillis@ameritrustcdc.com
For details on the SBA’s 504-loan program, please visit our web site at: www.ameritrustcdc.com
Download Ameritrust CDC Loan Application
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