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Product Type:

Owner-Occupied SBA 7a

Property Type:

Community lending program to improve the locality for almost any business in the U.S.

Loan Amount (min/max):

$250,000 to $2MM

LTV (max):

90%

Amortization / Term:

20/20

Minimum FICO:

650

Minimum DSCR:

1.10x

Non-Eligible:

Ground Lease, Gas Stations, Churches

Cash-out:

N/A

Collateral:

Real Property

SBA 7(a) Loans

Commercial Real Estate

Term 25 years

Interest Rate Variable Rate/ Prime + (up to 2.75%)

Advance Rates (LTV) 90% general purpose

60% to 80% special purpose (i.e. gas stations, hotels, etc.)

Contact SBA Department for maximum allowable LTV

Maximum Loan $2,000,000

Occupancy Minimum 51%; 67% if ground up construction

Debt Service Coverage 1.1x (last year and interim period)

Experience Minimum 2 year of industry or management experience

FICO 680 or greater

Collateral Additional collateral may be taken (includes UCC filing on

business assets, Deeds of Trust on real property, etc.)

Prepayment Penalty 5%, 3%, 1%, first three years

Business Acquisition

Term 10 years

Interest Rate Variable Rate/ Prime + (up to 2.75%)

Injection Minimum of 10% cash (dependant on collateral)

Debt Service Coverage Minimum 1.1x (last year and interim period)

Experience Minimum 2 year of industry or management experience.

FICO 680 or greater

Collateral All available collateral to be taken (incl. UCC filing, D/T,

etc.); loans >$750M require 100% discounted collateral

coverage on the amount over $750M.

Prepayment Penalty 5%, 3%, 1%, first three years

Equipment/Working Capital

Term 7 or 10 years

Interest Rate Variable Rate/ Prime + (up to 2.75%)

Injection Minimum of 10% cash injection

Debt Service Coverage 1.0x (last year and interim period)

Experience Minimum 2 year of industry or management experience.

FICO 680 or greater

Collateral UCC filing on business assets; as well as all other

available collateral to be taken.

Prepayment Penalty 5%, 3%, 1%, first three years

Start Up Business

Term 7 to 10 years

Interest Rate Variable Rate/ Prime + (up to 2.75%)

Injection Minimum of 10% cash

Debt Service Coverage 1.1x for the initial year and next full year of projections;

Projections must be completed for the first 2 years, 1st year

month to month.

Experience Two years transferable management experience required.

FICO 680 or greater

Collateral No minimum collateral required, although, all available

collateral to be taken.

Loans to Professionals*

Term 7 to 10 years

Interest Rate Variable Rate/ Prime + (up to 2.75%)

Injection Minimum of 10% of total project cost

Debt Service Coverage 1.1x for the initial years and next full year of operations;

Projections must be completed for the first 2 years; 1st

year month to month.

Experience Recent two years: a) employed by same practicing

professional; b) partner in an existing practice.

FICO 680 or better

Collateral No minimum collateral required, although all available

collateral to be taken.

*Medical Doctors, Dentists, Veterinarians, and Legal Professionals

 

Product Type:

Owner-Occupied SBA 504

Property Type:

Community lending program to improve the locality for almost any business in the U.S.

Loan Amount (min/max):

$250,000 to $4MM

LTV (max):

40%

CLTV (max):

90%

Amortization / Term:

20/20

Minimum FICO:

650

Minimum DSCR:

1.00x

Non-Eligible:

Ground Lease

Cash-out:

N/A

Collateral:

Real Property

The SBA 504 Loan Program
SBA 504 loans provide small business owners with the same sort of attractive, long-term, fixed rate financing available to larger businesses. Funds can be used to buy a facility, to buy land and build a new building, to renovate or expand an existing structure, and / or to purchase equipment and machinery for a business.

What Businesses Are Eligible For SBA 504 Loans?
The program is intended for small and medium-sized businesses. Large businesses, those with a net worth of more than $7.5 million or an average income, after taxes, of more than $2.5 million for the last two years, may be too big to access the program.

What Is The Loan $$$ Limit?
Normally, the 504 loan is limited to 40% of the total project up to a maximum of $1,500,000. However, “under-served” business categories (i.e. rural based, women-owned, veteran or minority-owned businesses; projects located in enterprise zone; and businesses that export), can secure up to $2,000,000 in SBA 504 funds, and small manufacturing firms can apply for up to $4,000,000 in SBA 504 loan program assistance.

What Are The Interest Rates, Terms and Costs?
Interest rates on the 504 portion are set by the market each month when a 504 bond is sold in New York. When the bond is sold, the interest rate is fixed for the life of the loan. The term of the 504 loan may be either 10 years (machinery and equipment loans) or the more common term of 20 years (real estate loans). Partner lenders / bankers who provide approximately 50% of the total financing project, will charge their own market interest rates. To ensure that the program does not cost taxpayers anything, a borrower will pay fees that roughly approximate the cost of the program -- these consist of a one-time origination fee of 2.24% on the SBA 504 loan, plus an attorney closing fee of $1,500. These fees are usually financed as part of the total SBA 504 loan so borrowers don’t have to come up with additional funds at closing. Other fees are included in the interest rate the borrower pays, although these are all fully disclosed up front.

What Collateral is Required?
Generally, the assets of the project being financed are adequate collateral for the purposes of the 504 Loan Program. Personal guarantees of the principal owners of the business will be required. In rare and exceptional cases, personal assets may be attached.

 
 
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