January 2020
Commercial Lending
January 2020 SBA 504 Loan Interest Rate Report

The January effective interest rates for Small Business Administration (SBA) 504 loans fixed slightly higher than last month, but still remain under 4% for an 8th consecutive month and well below the Prime Rate.

SBA 504 Loan Monthly Interest Rate ReportSmall businesses also continue to take notice of the 25-year fixed rate term option.  Since its first funding in July 2018, the number of 25-year loans has increased significantly, with the latest pool financing 275 loans amounting to more than $207,000,000 million in commercial assets financed nationally.  Plus, 5 more years to pay off a commercial asset comes cheap.  January’s 25-year option has a fixed interest rate that is only 0.07% higher than the 20-year rate.

  The January 25-year effective interest rate for standard 504 loans is 3.714% and 3.716% for refinance loans.

  The 20-year effective interest rate for standard 504 loans is 3.644% and 3.646% for refinance loans.

  The 10-year effective interest rate for standard 504 loans for January/February (set bimonthly) is 3.804% and 3.806% for refinance loans.

The SBA 504 Loan Program provides up to 90% financing at below-market, fixed interest rates and long amortization terms up to 25 years for the purchase of major fixed assets, such as owner-occupied commercial real estate, renovations, new construction, energy efficient “green” initiatives and/or fixed heavy duty machinery and equipment.

504 loans are paired with private-sector commercial loans and provide up to $5 million of aggregate SBA eligibility on standard 504 projects; up to $5.5 million per 504 energy efficient green project not exceed $16.5 million in the aggregate; and up to $5.5 million per eligible small manufacturing project with no limit on total SBA dollars available.  These are SBA 2nd mortgage loan portions only; there is no limit on overall project dollar size.

Understanding the 504 Loan Interest Rate

For more information about SBA 504 loans in Alabama, Florida or South Georgia, contact a Florida First Capital Loan Officer or email us at info@FloridaFirst.com.  Phone: 850.681.3601 or toll-free at 800.504.LOAN.