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SBA 504 Interest Rates Still in the "2s"

Jan 2021

Although we've seen consecutive months with identical increases of 7 basis points, Small Business Administration (SBA) 504 loan fixed interest rates have remained steady over the past 60 days amidst the pre-election uncertainty and post-election turbulence.

Nonetheless, the 1st fixed 504 interest rates of 2021 marked the 9th consecutive month with rates in the "2s." The continued low interest rate environment coupled with some recent significant changes to the 504 loan program as part of the new Consolidated Appropriations Act, 2021, are really driving great interest in 504 loans.

• The January 25-year effective interest rate for standard 504 loans is 2.696% and 2.737% for refinance loans.
• The January 20-year effective interest rate for standard 504 loans is 2.658% and 2.702% for refinance loans.
  
  
• The 10-year effective interest rate for standard 504 loans is 2.450% and 2.489% for refinance loans (set bimonthly).

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, as well as the refinance of commercial mortgage and other business debt with or without a cash-out option.

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.

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@ffcfc.com. Phone: 850.681.3601 or toll-free at 888.320.5504.