The SBA -backed portion of the 504 loan will be a second mortgage, financing up to 40 percent of eligible project costs… by Altoona Blair County Development Corp. 504 Loan . … Debt is not included as an Eligible Business Expense, except debt that was incurred with a credit card or a business line of credit may be included if the credit card or business line of credit is issued in the name of the small business and the Applicant certifies that the debt being refinanced was incurred exclusively for business related purposes. SBA 504 financing cannot be used to improve tenant space with specialized improvements. These funds generally can be used, in conjunction with bank financing, to fund up to 90% of eligible project costs. Under certain circumstances, a borrower may be required to contribute up to 20% of the total project costs. Pennsylvania SBA 504 | First Frontier 504 Program | Small Business Lending. These include, but are not limited to, the following: (a) Debt refinancing (other than interim financing), except as provided in § 120.882(e) and (g). A. In addition to a cash contribution, the Borrower's contribution may be satisfied as set forth in § 120.910 or by the equity in any other fixed assets that are acceptable to SBA as collateral for the Refinancing Project, provided that there is an independent appraisal of the fair market value of the asset; (i) The portion of the Refinancing Project provided by the 504 loan and the Third Party Loan may be no more than 90% of the fair market value of the fixed assets that will serve as collateral, except that if the Borrower's application includes a request to finance the Eligible Business Expenses described in paragraph (g)(6)(ii) of this section, the portion of the Refinancing Project provided by the 504 loan and the Third Party Loan may be no more than 85% of the fair market value of the fixed assets that will serve as collateral and the Borrower may receive no more than 20% of the fair market value of the Eligible Fixed Asset(s) securing the Qualified Debt for Eligible Business Expenses; (ii) The Borrower's application may include a request to finance eligible business expenses as part of the Refinancing Project if the amount of cash funds that will be provided for the Refinancing Project exceeds the amount to be paid to the lender of the Qualified Debt. There are three partners in an SBA 504 loan—the borrower, a bank or other regulated lender, and a CDC. Low down payment. SBA 504 Eligibility. Refinancing guidelines WITHexpansion 1.Eligible Project Costs 2 a.Commercial real estate (occupied at least 51% by the Operating Company). Bigger loans: The green 504 is a second mortgage that can be as much as $5.5 million per project. Prepayment penalties, financing fees, and other financing costs must also be added to the amount being refinanced in calculating the percentage reduction in the new installment payment. Another lender must provide at least as much project financing as the 504 loan; How it works: OSDC partners with a participating lender to provide the appropriate financing solution. These apply to you (the borrower), but also to lenders, and even the project you’re about to embark on. These costs include the origination fee of 1.50%; the funding fee of ¼ of 1% and the underwriter’s fee of 1/2 of 1%. Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account. Eligible Project Costs Eligible costs for SBA 504 funding are the purchase, renovation, construction or expansion of owner-occupied real estate. Fair market value refers to the current appraised value of an asset that is established by an independent appraiser in accordance with the standards established by SBA in its SOPs. Site … 5000-885 announced that the final rule for the Certified Development Company (CDC) 504 loan program was published on October 7, 2003 and became effective November 6, 2003. 2. Funds for the 504 portion of the project come from SBA Guaranteed Debentures issued by CDC’s, and are sold in the private bond market, typically around 40% of the total project cost. Same institution debt means any debt of the Third Party Lender that is providing funds for the refinancing, or of its affiliates. 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