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SBA 504 Loan Interest Rates

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October 2021

25-Year Fixed Rate Standard:
2.912%

25-Year Fixed Rate Refinance:
2.926%

20-Year Fixed Rate Standard:
2.765%

20-Year Fixed Rate Refinance:
2.779%

10-Year Fixed Rate Standard:
2.677%

10-Year Fixed Rate Refinance:
2.739%

Full-term fixed interest rates shown; includes all servicing fees

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504 Bridge Loan Program

504 Bridge Loan Program Eases Interim Risk for SBA Lending Partners.

Under the Small Business Administration (SBA) 504 Loan Program, commercial lenders partner with a certified development company (Florida First Capital) to provide small business owners with up to 90% financing for the purchase of owner-occupied commercial real estate and/or fixed machinery and equipment.

Typically, a 504 loan is structured whereby a commercial lending partner finances 50% of the project and holds the first mortgage. Florida First Capital/SBA finances 40% of the deal and holds the second mortgage. The borrower provides a 10% down payment.

One of the most critical stages for a commercial lending partner in an SBA 504 loan project is the interim phase between the commercial lending partner’s closing and the permanent takeout of the second mortgage by the SBA, during which time the commercial lending partner is at risk on the second mortgage.

The 504 Bridge Loan Program, available for any Florida SBA 504 loan, addresses this exposure and timing difference by providing commercial lending partners with bridge loan funds to cover the second mortgage until the permanent SBA second mortgage takeout occurs.

504 Bridge Loan Basics

  • Loans amounts are generally capped at $5 million.  Certain eligible energy-efficient or manufacturing projects may qualify for up to $5.5 million, in line with SBA standards.  Generally, the total project limit is $20 million. (This restriction applies to the principal amount of the loan directly supported by the 504 bridge loan, plus all other loans for the same loan purpose that close on or about the same date.)
  • The initial term is six (6) months with automatic extensions and pricing adjustments after 1 year.
  • Bridge loan funds may be used for interim project financing of the second mortgage of authorized SBA 504 loan projects, including straight acquisitions, renovations or build-out projects, ground-up construction and/or fixed heavy duty machinery and equipment purchases.

NOTE: The 504 Bridge Loan Program is available in Florida only.

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