SBA 504 Loan

Current SBA-504 Effective Rate Estimated at 4.38%*
* includes fees to CDC, SBA, and central servicing agent. Based on pricing published by NADCO 09/17.

The US Small Business Administration’s 504 Loan Program, also known as the Certified Development Company Program, provides affordable long term, fixed-rate financing to help healthy, expanding small and medium sized businesses grow.  The loans are for acquiring long–term fixed- assets, such as land, buildings, machinery and equipment, or for building modernizing, renovating, or greening facilities.  Growing businesses often are unable to qualify for traditional financing because of the difficulty of coming up with a down payment of 25% or more.  When a conventional loan is not possible, a 504 loan may be the answer.  The SBA’s 504 Loan Program gives small business owners access to the same low-cost fixed-rate, long-term financing large businesses have through the bond markets.  Other borrower advantages include:

  • Lower down payment
  • Below-market financing
  • Fixed-rate financing, which avoids the uncertainties of future market fluctuations
  • Longer repayment term (10 to 20 years)

What is a Certified Development Company (CDC)?

CDC’s are non-profit organizations often established to promote economic development in their communities.  Certified by the SBA, CDC’s operate under the jurisdiction of a board that includes members from local private-sector lending institutions, and business and community organizations.  Cal Coastal is the only local CDC in Monterey County.  A CDC helps small businesses with financing for fixed-asset projects by assembling, analyzing, and reviewing and presenting for SBA approval.  Once approved by SBA the loan is documented for closing.

A direct loan program funded through the SBA for long-term fixed assets.

Fixed-rate financing to buy property, build or expand facilities; purchase long term equipment.

Most “for-profit” companies. Job creation required. Private lenders provide 50% of the financing with the 504 providing up to 40% subordinate financing. The remaining 10% is provided by the borrower.


The maximum 504 loan amount is $5 million and the total project cost cannot exceed $12 million.

Subject to change by SBA.

10 and 20 years, fully amortized loan.

Tied to U.S. Treasury rates. Rate set at time of debenture sale.

Generally limited to the project being financed.

1.50% origination fee and other fees added to the project costs to be financed.

Pre-qualify here


Supporting Documents

Small Business Administration 504 Loan Program: Small Businesses’ Window to Wall Street (5029K PDF)

California Coastal Rural Development Corporation

221 Main St
Suite 301
Salinas, CA 93901
Phone: (831) 424-1099
Fax: (831) 424-1094
2625 S. Miller St
Suite 106
Santa Maria, CA 93455
Phone: (805) 349-0798
Fax: (805) 623-8396
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