SBA 504 Loan
- The US Small Business Administration (SBA) is a federal agency with the main purpose of helping small businesses get the funds they need for real estate or equipment.
- Enjoy lower down payments and long repayment terms
- Preserve working capital for operational expenses and apply today!
Take advantage of an 85% approval rate - act now!
What are SBA 504 Loans?
The U.S. Small Business Administration 504 Certified Development Company Loan program conserves our working capital by requiring only a 10 percent borrower contribution.* If you do not qualify for conventional financing, the SBA-backed 504 loan may be right for you. Certified Development Company (CDC) are nonprofit corporations that promote economic development within their communities through 504 loans. The SBA authorizes CDCs to provide financing to small businesses with the help of third-party lenders (typically banks)
This loan program provides financing for businesses to purchase real estate, major fixed assets, and equipment, or to make improvements like landscaping. This program can also provide funding for renovation.
504 Loan Program Details
10 Year US Treasury Rate +
10, 20, or 25 Years
30 to 60 Days
Up to $5M
How can I use an SBA 504 loan?
A Small Business 504 can be used for many things for example:
- Purchase existing building
- Land acquisition and ground-up construction (can include soft cost development fees)
- Expansion of existing building
- Finance building improvements
- Purchase equipment
- Job creation
- Purchase or renovate capital assets (land, buildings)
- Refinancing permitted
- New Construction
- Leasehold Improvements
SBA 504 Loan Program Eligibility Requirements
Below you will find some of the Eligibility requirements for small businesses:
- A good credit score – preferably above 660.
- A history free from recent bankruptcies, foreclosures, or tax liens.
- Having been in business for at least two years.
- Be a nonprofit corporation in good standing
- Have a board of directors with at least nine voting directors (additional board of directors requirements are listed in 13 CFR 120.823)
- Have full-time professional management and a full-time professional staff
- Meet a minimum level of lending activity
Who is eligible for SBA 504 Loan?
While the bulk of small businesses are eligible for financial assistance from the SBA, a small amount aren’t. To be eligible for a 504 Loan, your business must: Operate as a for-profit company in the United States or its possessions. Have a tangible net worth of less than $15 million. Have an average net income of less than $5 million after federal income taxes for the two years preceding your application.
What are the SBA 504 Loan Interest Rates and Terms?
Interest rates are negotiated between the borrower and the lender but are subject to SBA maximums, which are pegged to the prime rate, the LIBOR rate, or an optional peg rate. Interest rates may be fixed or variable according to the Small business administration and its 504 loan program guidelines.
- Pegged to an increment above the current market rate for 5-year and 10-year U.S. Treasury issuesÂ
- Totals approximately 3 % of the debt, a rate may be financed with the loan
What are the fees on SBA 504 Loans?
Interest rates on 504 Loans are directly connected with the current market rate for 5-year and 10-year the U.S. Treasury issues. Loan maturities can vary and terms of 10 and 20 years are available. Fees may also be financed with the loan.
SBA 504 Pros vs Cons
PROS
Lower down payments and longer repayment terms
Payment Stability – Fixed low interest rate on 504
Includes moving and installation costs
Up to $5 million for SBA portion of the loan, no limit on overall project size
CONS
Lengthy and complex application process
Stringent eligibility criteria for approval
Is an SBA 504 Loan a Good Choice?
The benefits of an SBA 504 Loan to small businesses
- Low down payment usually only requires 10% of the loan value down.
- Low, fixed interest rate on 504
- Long loan term
- Includes moving and installation costs
- Payment stability
- No future balloon payments
- Up to $5 million for SBA portion of loan, no limit on overall project size
- Keep your lender or allow us to match you with one of our lending partners
Open the Door to Financial Freedom: Access a Business Line of Credit.
What truly set Mike apart was his honesty. He reviewed multiple lender options with me in a fair, transparent way, walking me through the pros and cons of each and helping me understand every angle. He encouraged me to move forward only with what felt right for my business, never once making me feel pressured to choose him or Upwise. That level of professionalism is rare.
Mike also worked hard to build genuine personal rapport — something no other representative I spoke with did. He took the time to understand my business, explored different paths, and made sure I felt confident and comfortable throughout the decision-making process.
The follow-up from Mike and every member of his team has been above and beyond anything I’ve experienced with other lenders. Every interaction feels thoughtful, client-focused, supportive and most important- genuine. I’m incredibly grateful for the experience and would confidently recommend Mike to anyone looking for a knowledgeable, ethical, and truly client-first lending partner.
Update: Leo contacted me, and after basically insulting me concerning their prior behavior, I decided to let them run my application. After being ghosted for the day, they finally came back and denied due to another loan my business was involved in. These people get their feelings hurt way to easy to be in this business. I would not recommend this company to anyone.
Upwise
If approved how long does it take to get SBA 504 loans?
The time to turn around an SBA 504 loan is typically between 60-75 days there may be special cases where businesses may experience longer or shorter times.
What equipment can be purchased with an SBA 504 loan?
Now, below are just a few examples of equipment you might buy within industries that do qualify for an SBA loan:
- Purchase of One or More Existing Building
- Construction of One or More New Building
- Land Purchase or site improvements
- Commercial Printers
- Food Processing Machinery
- Highly Calibrated Machines
- Equipment that generates renewable energy
What properties Qualify for an SBA 504 loan?
SBA 504 loans are designed to help business owners purchase, construct, renovate, or expand owner-occupied commercial properties. To qualify, the business must generally occupy at least 51% of an existing building or 60% of a newly constructed property, with plans to occupy additional space over time.
Many different property types can qualify for SBA 504 financing, including:
- Office buildings
- Medical offices and healthcare facilities
- Warehouses and distribution centers
- Manufacturing facilities
- Industrial buildings
- Retail stores and shopping centers
- Restaurants and hospitality properties
- Auto repair and service facilities
- Daycare centers
- Veterinary clinics
- Dental practices
- Professional service offices
- Mixed-use commercial properties
- Commercial condominiums
- Self-storage facilities (owner-operated)
- Agricultural and farming facilities
Eligible SBA 504 Projects
In addition to purchasing commercial real estate, SBA 504 financing may be used for:
- Ground-up construction projects
- Building expansions and additions
- Property renovations and improvements
- Land acquisition for business use
- Site preparation and infrastructure improvements
- Major equipment and machinery purchases
- Refinancing eligible commercial real estate debt in certain situations
Owner-Occupied Requirement
Unlike many conventional commercial real estate loans, SBA 504 financing is intended for businesses that will actively operate from the property being financed. Investment properties and passive real estate investments generally do not qualify for the SBA 504 program.
If you’re considering purchasing, building, or expanding a commercial property, Upwise Capital can help determine whether your project qualifies for SBA 504 financing and identify the most appropriate financing structure for your business.
Apply for a SBA 504 Loan Now.
- Finance fixed assets like real estate or equipment
- Benefit from SBA's guarantee, reducing lender risk
- Take advantage of fixed interest rates for stability
Stay ahead of the curve - get access today!
Documents You'll Need to Apply
Driver’s License
Voided Business Check
Business Bank Statements (Last 4 Months)
Credit Score
Credit Application
Real Estate / Collateral Information
You may also be requested to provide the following for larger dollar amounts over $100K:
Balance Sheets
Profit & Loss Statements
2 Years Business Tax Returns
2 Years Personal Tax Returns
Equipment List (if securing equipment)
Unlock the potential of your business with Upwise Capital’s SBA 504 loan program. Our experienced funding experts are ready to guide you through the process and provide tailored lending solutions to meet your unique needs. With competitive interest rates, low down payments, and long repayment terms, an SBA 504 loan can help you acquire or expand your facilities, purchase equipment, and create jobs.
Don’t wait to take your business to the next level. Apply now by filling out our simple Funding Application Form or call us directly at 775-5-UPWISE (879473) to speak with a knowledgeable representative. Get approved for an SBA 504 loan within 24 hours and start building your success story today.
Why Upwise for an SBA 504 Loan
Quick & easy application
Our simple 15-minute application gets you on your way to funding quickly. Most applicants receive a fast decision within hours of applying. Then just choose your loan terms and you could have funds deposited into your account as soon as 24 hours.
Ensure you make the wise choice
Every Upwise applicant gets a dedicated funding advisor who takes the time to understand your business and it's unique needs. We are here for your support throughout the entire funding process.
Access multiple financing options
Upwise has an extensive product suite and a network of 100+ lenders. This means you're more likely to find the best match for your funding needs.
SBA 504 loan — key information
Provided by Upwise Capital · upwisecapital.com/sba-504-loan
Qualification requirements
- Personal credit history
- Business cash flow
- Industry experience
- Ability to occupy the property
- Available equity injection
- Financial strength of the business
Common uses
- Purchasing owner-occupied commercial real estate
- Constructing a new facility
- Expanding an existing building
- Renovating commercial property
- Purchasing heavy machinery and equipment
- Modernizing business facilities
- Building equity through ownership
SBA 504 vs. SBA 7(a) loan
- 504: Primarily for real estate and fixed assets
- 504: Long-term financing structure
- 504: Fixed-rate component available
- 504: Designed for owner-occupied properties
- 504: Cannot be used for working capital
- 7(a): Broader range of business uses
- 7(a): Can be used for working capital
- 7(a): Can finance acquisitions and inventory
Best for
- Owner-occupied commercial real estate purchases
- Ground-up construction projects
- Building expansions
- Manufacturing companies
- Medical practices
- Professional service firms
- Businesses looking to own rather than lease
Key benefits
- Lower down payment than many conventional loans
- Long repayment terms
- Fixed-rate financing options
- Preserve business cash flow
- Finance large real estate and equipment projects
- Build long-term business equity
Frequently asked questions
- Can an SBA 504 loan be used to purchase commercial real estate?
- Yes. SBA 504 loans are commonly used to purchase owner-occupied commercial properties and are one of the most popular financing options for business real estate acquisitions.
- Can SBA 504 funds be used for working capital?
- No. Unlike SBA 7(a) loans, SBA 504 loans are generally limited to fixed asset purchases such as real estate, construction, and major equipment.
- How much down payment is required for an SBA 504 loan?
- Down payment requirements vary based on the project, property type, and borrower profile. Many SBA 504 borrowers contribute significantly less equity than required under conventional financing programs.
- Can startups qualify for SBA 504 financing?
- Yes. Startups may qualify, although additional equity contributions and documentation may be required depending on the lender and project.
- What is the difference between an SBA 504 loan and an SBA 7(a) loan?
- The SBA 504 loan is primarily for real estate and fixed assets, offers long-term fixed-rate financing, and is designed for owner-occupied properties. The SBA 7(a) loan covers a broader range of business uses including working capital, acquisitions, and inventory, with greater flexibility in use of proceeds.
Ready to explore SBA 504 financing for your real estate or equipment project?
Apply Now →Final Thoughts on SBA 504 Loans
The SBA 504 loan program is one of the most effective financing solutions available for small business owners looking to purchase commercial real estate, acquire machinery and equipment, construct new facilities, or refinance eligible existing debt. Unlike many traditional business loans, the SBA 504 program was specifically designed to help businesses invest in long-term fixed assets that support growth, expansion, and job creation.
An SBA 504 loan is structured through a partnership between a bank or private lender, a Certified Development Company (CDC), and the borrower. Typically, the lender provides a portion of the financing, while the Certified Development Company facilitates the SBA-backed portion of the project. This unique structure allows business owners to access long-term financing with competitive fixed interest rates and lower down payment requirements than many conventional commercial loans.
One of the biggest advantages of SBA 504 loans is their ability to finance major business investments. The SBA 504 loan program can provide financing for commercial real estate purchases, construction projects, building expansions, land acquisition, machinery, equipment, and other qualifying fixed assets. Loan amounts through the SBA 504 program can reach $5 million for many projects, while certain manufacturing, energy-efficient, and public policy projects may qualify for total project financing exceeding $15 million.
To qualify for an SBA 504 loan, a business must meet SBA eligibility requirements and operate as a for-profit business within the United States. Generally, the business must have a tangible net worth below SBA limits and an average net income that falls within SBA guidelines. The business must also demonstrate sufficient cash flow and financial strength to support repayment of the loan.
For real estate transactions, the business must occupy at least 51% of an existing property being purchased. For new construction projects, businesses are generally required to occupy at least 60% of the completed property initially, with plans for future expansion. These occupancy requirements are important eligibility standards within the SBA 504 loan program.
The SBA 504 program is designed to support economic development and job creation. In many cases, borrowers can receive approximately $65,000 in financing for each job created or retained through the project. This focus on job creation helps distinguish SBA 504 loans from many other financing programs available to small businesses.
Eligible uses of SBA 504 financing include purchasing commercial property, constructing new facilities, renovating existing buildings, acquiring machinery and equipment, and refinancing certain qualifying debt tied to fixed assets. However, SBA 504 loans cannot be used for working capital, inventory purchases, or speculative investments. Businesses seeking working capital may be better served by an SBA 7(a) loan or other business loan options.
The SBA 504 loan application process typically requires financial statements, tax returns, a business plan, insurance documentation, project details, ownership information, and other supporting materials. Borrowers must prepare a 504 loan authorization package and work with a Certified Development Company to process the application. Most SBA 504 loan applications take approximately 30 to 90 days to complete, depending on the complexity of the project and the responsiveness of the borrower.
Repayment terms are designed to support long-term growth and capital investment. SBA 504 loans often feature fixed rate financing with repayment terms extending up to 20 or 25 years, providing predictable monthly payments and protection from future interest rate increases. These long-term repayment structures help preserve cash flow and allow businesses to invest in growth while maintaining financial stability.
If you’re considering purchasing commercial real estate, financing equipment, expanding operations, or funding a major project, an SBA 504 loan may provide the low-interest, long-term financing your business needs. Upwise Capital works with banks, Certified Development Companies, SBA lenders, and financing partners nationwide to help business owners understand eligibility, navigate the loan application process, and secure the capital necessary to achieve their growth objectives.