Our Services

We offer a variety of loans to help your small businesss.

SBA 7(a) Loan

We offer two types of SBA loans; the most popular is the SBA 7a loan transaction that has a maximum amount of $5,000,000. The SBA 7a loan is a simple transaction compared to the SBA 504 due to there is one closing, one lender, and one loan. For more information on the loan program, you may review the content page SBA 7(a) or visit sba.gov.

Eligibility:

  • Project costs are flexible and can be used for any legitimate business purpose. This includes a variety of things such as land acquisitions and improvements, equipment purchase, soft costs a, working capital, franchise fees, among other things.
  • The business must be for profit.
  • The business must occupy a minimum of 51% of an existing facility and 60% for new construction or have a plan to use the additional space withing 3 years.


Advantages:

  • The speed of processing the 7a loans is much faster than the other loans available.
  • The use of proceeds and the required collateral requirements are much more flexible in this program.
  • The term for the loans under this program runs from 3 years to 25 years.
  • The loan is non-callable.
  • Most lenders we do business with are PLP Lender, which means they have the latitude to make the SBA 7a approval decisions based on the approved SBA SOP.

SBA 504 Loan

The SBA 504 loan program is a little different as there are two loans. The same objective is accomplished; however, the lender provides a loan of no less than 50% of the total project. The SBA, through a Certified Development Company (CDC), provides a loan of up to 40% of the total project and the balance is owner equity. The three parts:


Eligibility:

  • Project costs are flexible and can be used for any legitimate business purpose. This includes a variety of things such as land acquisitions and improvements, construction of a new building, tenant improvements, equipment purchase, soft costs, working capital, franchise fees, among other things.
  • The business must occupy a minimum of 51% of an existing facility and 60% for new construction.
  1. First Mortgage loan provided by Lender up to 50% of the project cost. This is a conventional type of loan with a separate note, rate, terms, etc.
  2. Second Mortgage loan is provided by a Certified Development Company (CDC) and SBA and provides financing up to 40% of the total project cost or a maximum of $5,000,000. The term of the 504 loans can be 20 years for real estate and 10 years for equipment. The interest rate will be fixed for maturity and is generally below market.
  3. The last piece is the borrower’s equity contribution. The borrower must inject 10% of the total project costs. If this is a startup business or the facility is special use, the down payment may be as much as 20% of the total project costs.  Equity can be in the form of cash, equity in land/building supported by an appraisal, or other fixed assets that are part of the overall project.


Advantages:

  • The process is two fold, first the approval from the lender then the lender gets the support and approval from the CDC , which is the entity that submits to the SBA for approval.
  • The loan will normally be funded by the main lender with a first lien note and a second line note. It can also be funded as one loan with the full amount of both the first lien and the second lien , then when the debenture is issued those proceeds go to the lender to reduce the funded note.
  • Prepayments for the lender are flexible. The prepayments for the CDC and debenture are set with a declining method and will be explained by the CDC approving the loan.
  • The use of proceed on the 504 are usually fixed assets.
  • The 504 structure can be used to refinance other SBA loan
  • The 504 loan can partners buyouts with the correct collateral structure.
  • Fully amortizing loans, no call provisions or balloon payments

USDA B&I Loans

USDA B&I loans are similar to the SBA 7(a) program as it is one loan from Lender. To qualify, most of the collateral must be in a “rural” area with a population of less than 50,000. To see if the address is eligible for a B&I loan click here. B&I loans range from $1,000,000 up to $25,000,000 and do not have the same “small business” size standards.

Eligibility:

  • Project costs include a variety of things such as land acquisitions and improvements, construction of a new building, equipment purchase, soft costs, etc.
  • Business must be a for profit entity.
  • Most businesses are eligible; however there are some businesses such as non-profit organizations, passive investor type transaction, or development type transactions that do not qualify.

Advantages:

  • Longer terms – fully amortizing
  • Rates are market rates and are sent by the financial institution
  • Loan fees may be financed
  • Non owner occupied so investors are welcome into the program.
  • There is no size limitation for the borrower

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