Sample Project
Real Estate Purchase – $2,500,000
Closing costs may include but are not limited to appraisal report, environmental report, title search & insurance, recording fees, and GA intangible tax.
| Source of Funds | Loan Amount | % | Rate | Term – RE | Term – Equip |
|---|---|---|---|---|---|
| Bank First Mortgage Loan | $1,250,000 | 50% | Market | 10-YRS+ | 7-YRS+ |
| SBA 504 Second Mortgage Loan | $1,000,000 | 40% | Fixed Rate | 20-25 YRS | 10-YRS+ |
| Borrower Down Payment | $250,000 | 10% | |||
| Total Purchase | $2,500,000 | 100% |
LOAN AMOUNT
504 Loans are available for up to $5.0 million, or $5.5 million for a Small Manufacturer or Green Energy loan. Combined with the 1st Mortgage Loan, projects in excess of $10 million can be funded.
DOWN PAYMENT
Amount varies depending on project type. New businesses (less than 2-years) and loans for special purpose properties (Example: Gas Station, Hotel) require an additional 5% down payment. New business loans for the purchase of special-use properties require a 20% down payment.
TERM OF LOAN
504 loan can be a 10, 20, or 25-year fully amortizing loan. Bank loan has a minimum 10-year term and 15-30-year amortization.
REPORTS
Both loans utilize the same appraisal and environmental reports.
PREPAYMENTS
Penalty on 504 Loan is a declining percentage of balance for first 10-years (20 or 25-YR Loan) of first 5-years (10-YR Loan).
Any penalty on Bank Loan is negotiated with the Bank Lender.