The SBA 504 loan program provides long-term, low interest, fixed-rate financing to small businesses for construction, purchase or renovation of facilities; or to acquire machinery and equipment. A 504 loan package is a combination of two loans, one from Wyoming Capital Access and a second loan from a commercial lender selected by the borrower.
How is an SBA 504 Loan Project Structured
504 loans for existing businesses are typically financed 50% by the participating commercial lender, 40% by the CDC, and 10% by the business borrower. For example, a $2,200,000 real estate project for an existing business might be structured as follows.
| Commercial Lender | Wyoming Capital Access | Business Borrower | |
| Loan Amount | $1,100,000 | $880,000 | $220,000 |
| Percent of Project | 50% | 40% | 10%* |
| Term | Min 10 Years | 20 Years | Equity |
| Interest Rate | Market Rate | Fixed Rate | |
| Collateral | 1st Mortgage | 2nd Mortgage |
*Start-up business OR a Special Purpose building requires 15% borrower equity
*Start-up business AND a Special Purpose building requires 20% borrower equity
An SBA 504 Loan is a powerful business financing tool that enables successful businesses to grow:
- Up to 90% financing preserves working capital for business expansion.
- The borrower chooses the 1st Mortgage lender based on their terms and interest rates.
- SBA loan fees are included in the 504 loan to reduce up-front cash outlay.
- The borrower is charged for title insurance and recording costs.
- Fixed interest rate on the SBA loan (10, 20, or 25 years) for life of the loan.