FREQUENTLY ASKED QUESTIONS

How much is the down payment?
The typical down payment for an SBA 504 loan is 10%. Start-up businesses OR special-purpose building requires 15% equity. A start-up business AND special purpose building requires 20% equity.

Is the loan variable or fixed?
The SBA 504 loan is a 20-year fixed rate and is fully-amortized. The SBA portion typically comprises 40% of the loan, while a First Lender participates for 50% of the loan. We work with lenders nationwide providing a wide variety of terms, including short-term variable rate loans, and long-term fixed rate loans. We can help you determine what the most optimal capital structure is for your business.

Do I need to occupy the building?
Your business needs to occupy at least 51% of the existing project building and 60% for ground-up construction projects.

How long does it take?
Usually we recommend 45 days for financing contingency and 60 days total to close of escrow. However, due to our "Premier Certified Lender" status, which allows us to approve loans internally, we are able to close escrow in as little as 30 days.

Do I have a choice of First Lenders?
Capital Access Group works with lenders nationwide. We can help you choose a first mortgage lender for your loan, or we can use a lender of your choosing.

How do I apply?
The first step is a no-charge Pre-Qualification. Simply contact Capital Access Group today and we will start you on your way.

What are the fees?
For a limited time, the SBA is charging only 0.65% on its portion of the loan (typically 40% of the Total Project Cost), however this fee is financed into the loan and not an up-front out-of-pocket cost to the borrower. The First Lender on the transaction may also have a loan fee of 0.5 to 1.5 points of its portion of the Total Project Cost (typically 50%). In addition, there will be a charge for an appraisal and an environmental report.

Is the SBA loan assumable?
Yes. If you choose to sell your building, your SBA loan can be assumed by the buyer - and the buyer does not have to be a small business !

Is there a pre-payment penalty?
Due to the below-market long term nature of the SBA 504 loan, there is a pre-payment penalty for the first 10 years of the loan. In the first year, the penalty is 100% of that year's interest payment. Each subsequent year, the amount goes down by 10% until year 10, after which there is no pre-payment penalty.

Is there a maximum size of the SBA loan?
Currently, the maximum size the SBA portion of your loan can be up to $2.0 million (up to $4.0 million for eligible small manufacturers or energy-saving facilities). However, the Total Project Cost can reach above $10 million.