SBA 504 Loan Program & 504 Loans Definition

Intelligent Financing for the 90s The 504 Loan is an economic development financing program for small and medium sized businesses that need to invest in space or purchase machinery and equipment to further enhance the growth of their business.

Basic criteria for eligibility:

• History of profitability and reinvestment in the company
• Must create or retain jobs or satisfy other defined economic development objectives
• Owner-occupied financing
• For profit company
• Financing needs must be used for long term fixed assets
• New financing (no refinancing or debt restructuring)

Financing is based upon total project cost and comes from three sources,

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% of Source Lien Amount Rate Term Term
Project Real Equip.
Cost Estate
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50% Private 1st No Limit Market 10 Yrs + 7 Yrs +
 (Bank)
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40% 504 2nd $50,000 Fixed 20 Yrs 10 Yrs
 to $750,000**
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10% Equity
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** The 504 Loan amount can increase to $1 million if the project
or business qualifies in one of the following ways: minority owned
business; located in a rural area as defined by SBA; manufacturing
facility or advancement of technology; company must make changes
due to regulatory environmental compliance; financing will assist
in expansion of exports; business district revitalization; changes
necessitated by Federal cutbacks

Loan Process

Contact Certified Development Company in your area to discuss whether your business and your project meet 504 guidelines. It is responsible for preparing a detailed credit analysis and for preparing the 504 loan package. We work directly with the small business and will assist in finding a first trust lender. Total time is approximately 60 to 90 days.

Where to go for further information

The 504 Loan is available through SBA Certified Development Companies. Certified Development Companies are private, nonprofit corporations whose purpose is to assist small businesses. The Certified Development Company located in the same area as your business will assist you.

The following Certified Development Companies service Virginia, Maryland and the District of Columbia:

VIRGINIA ASSET FINANCING CORP. (Serves Virginia) 12020 Sunrise Valley Drive, Suite 260 Reston, VA 22091 703-475-0504

CENTRAL VIRGINIA ECONOMIC DEVELOPMENT CO. (Serves the Counties of Amherst, Appromattox, Bedford, Campbell and the City of Lynchburg, Virginia) P.O. Box 817 Lynchburg, VA 24505-0817 804-845-3493

CRATER DEVELOPMENT CO. (Serves the Counties of Chesterfield, Dinwiddie, Greensville, Prince George, Surry and Sussex, Virginia) P.O. Box 18080 Petersburg, VA 23805 804-861-1666

JAMES RIVER CERTIFIED DEVELOPMENT CO. (Serves the Counties of Chesterfield, Charles City, Goochland, Hanover, Henrico, New Kent and Powhatan, Virginia) P.O. Box 27025 Richmond, VA 23261 804-788-6966

PORTSMOUTH CERTIFIED DEVELOPMENT CO. (Serves the City of Portsmouth,Virginia) P.O. Box 820 Portsmouth, VA 23705 804-393-8804

RAPPAHANNOCK ECONOMIC DEVELOPMENT CO. (Serves the Counties of Caroline, King George, Stafford and Spotsylvania, Virginia) P.O. Box 863 Fredericksburg, VA 22404 800-627-2892

URBAN BUSINESS DEVELOPMENT CORP. (Serves the City of Norfolk, Virginia) 201 Granby Mall, Ste. 1000 Norfolk, VA 23510 804-623-2691

VIRGINIA ECONOMIC DEVELOPMENT CORP. (Serves the Counties of Albemarle, Fluvanna, Greene, Louisa and Nelson, Virginia) 413 East Market St., Ste. 102 Charlottesville, VA 22901 804-972-1728

MID-ATLANTIC CERTIFIED DEVELOPMENT CO. (Serves Maryland) 2 Hopkins Plaza, 9th Floor Baltimore, MD 21201-2911 703-539-2449

PRINCE GEORGES COUNTY FINANCIAL SERVICES CORP. (Serves Prince Georges County, Maryland) 9200 Basil Court, Ste. 200 Landover, MD 20785 301-386-5600

Kathleen Strawhacker Executive Director, Virginia Asset Financing Corporation (703-476-0504),Vice President for Product Development for the Nat'l Association of Development Cos. (NADCO) (the trade association of certified development companies)