New Year, New Commitments
With a New Year and decade underway, 2020 is a great opportunity for commercial lenders to partner with Florida First Capital to offer the Small Business Administration (SBA) 504 Loan Program to growing and expanding small businesses for the purchase of fixed asset purchases like owner-occupied commercial real estate and/or heavy duty machinery and equipment.
Not only can commercial lending institutions increase their small business lending efforts and their portfolios by working with us, but also reduce their lending exposure under the 504 loan program’s distributed credit structure.
Cut portfolio fat with low loan-to-value ratio 504 loans. Florida First Capital provides SBA backed second mortgage financing up to 40% of the project cost, thus conserving liquidity and helping to manage lending limits and industry exposure. The partnering commercial lending institution gets a 50% loan-to-value first lien position on the assets being purchased – cutting risk tremendously. And for added security, our commercial lending partners can utilize the 504 Bridge Loan Program to cover all or part of the SBA second mortgage during the interim period of the 504 project until the permanent SBA second mortgage takeout occurs.
Save Your Borrowers Money
The SBA 504 Loan Program provides small business borrowers up to 90% financing at below-market, fixed interest rates and long amortization terms for the purchase of major fixed assets, such as owner-occupied commercial real estate, energy efficient “green” initiative projects and/or heavy duty fixed machinery and equipment. With the low down payment option, borrowers can preserve valuable working capital for subsequent expenses. And with effective fixed interest rates below Prime, your clients will save substantial money over the repayment term, which ranges from 10 to 25 years, verses conventional financing.
Help Borrowers Get Out of Debt
Small business owners can lighten their monthly debt payments and access equity trapped in their owner-occupied commercial real estate holdings by refinancing conventional real estate loans through the SBA’s 504 Debt Refinancing Program. Under the program, small businesses can take advantage of below-market, fixed interest rate refinancing with repayment terms up to 25 years for up to 90% of the appraised value of commercial real estate property. Borrowers may also refinance eligible business operating expenses (cash-out option).
Expand Borrowers’ Horizons
Normally, borrowers are eligible for up to $5 million of aggregate SBA eligibility on standard and public policy 504 projects. However, borrowers may be eligible for multiple SBA 2nd mortgages of up to $5.5 million per green friendly project under the 504 Green Loan Program, but the outstanding gross debentures issued for a small business concern, including its affiliates, must not exceed $16.5 million in the aggregate. These amounts are NOT reduced by any other outstanding SBA financing (7a, Community Advantage, regular 504). Additionally, there is no limit on the amount of the 1st mortgage of a 504 project and therefore no maximum project size. In many cases, qualified borrowers with projects exceeding $20 million can still obtain up to 90% financing.
The SBA 504 Loan Program makes much needed affordable credit available to growing and expanding small businesses. Equally important, it is an investment in the backbone of the economy, which creates small business jobs that help build and support local economies and communities.
Time is Money
Florida First Capital is the proven SBA 504 loan expert to get your deals done efficiently. Our experienced professional staff takes care of all the paperwork, answers your questions and works with you every step of the way, freeing up your valuable time.
When it’s time to close the deal, our 504 small business clients and commercial lending partners have exclusive access to a specialized network of local closing attorneys, which saves time and money with simultaneous closings for straight acquisition projects.
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.