SBA Section 504 Loan Program

The SBA 504 Loan Program creates a 3-party partnership:

  • A private institution, such as a commercial bank, typically provides 50 percent of the total project financing. The bank holds a first mortgage lien position on the assets being financed, providing them with an incentive to offer more reasonable terms and favorable rates.
  • SEDCO finances up to 40 percent of the project.
  • Your company, the small business concern (SBC), normally contributes only 10 percent of the total project cost–a substantial savings of working capital for you.

SBA 504 Loans are designed specifically to help small business concerns with long-term, fixed asset financing, including the following:

  • Land
  • Building
  • Equipment
  • Building with renovations
  • Construction contingencies
  • Debt Refinance with expansion
  • Interest and Loan fee (on interim loan)
  • Professional fees (appraisal, environmental, title insurances, doc stamps, etc)

The term for an SBA Section 504 Loan is 10 years for equipment and 20 or 25 years for real estate financing. Private financial institutions are required to provide no less than 10 years financing on real estate and 7 years financing on equipment. You negotiate the interest rate on the first mortgage lien position with the financial institution. The financial institution’s excellent collateral position will allow them to offer better than normal rates.

Your SBA 504 rate is based on the current market bond rate at the time of the debenture sale. The actual cost includes an administrative and servicing spread over the current market bond rate.

SBA 504 Loans require personal guarantees from individuals with 20 percent or more ownership in the small business concern.

Service Area

State of Florida

Loan Amount

40% of project costs. Minimum $125,000. Maximum $5.5 million.

Use of Loan Proceeds

  • Real estate and/or construction
  • Renovation
  • Long-term equipment
  • Refinancing of existing real estate and/or equipment debt

Job Creation

One job created for every $65,000 of SBA loan


  • Company’s tangible net worth less than $15 million

  • Average net profit after taxes not greater than $5 million for the last three years


20 or 25 years (Equipment alone 10 years)


Fixed rate


Monthly payments


Second position on real estate/equipment

Borrower’s Cash Participation

Minimum 10% of project costs



Your SEDCO 504 Loan representative will guide you through the application process. See Contact Us page for your local representative. Below you will find additional information that we will need in order to get the loan process started for you on your project.

  • Estimate of total project costs, including new construction, renovation, machinery and equipment.
  • Any purchase agreements or offers to purchase for real estate involved in the project.
  • Information related to your company’s products, marketing, distribution and growth projections.
  • Tax returns of the company for the past three years, with an interim statement less than 90 days old and debt schedule
  • Personal financial statements and tax returns for the past three years for all owners with 20 percent or more ownership.
  • SBA 504 Application
Need Help or Have Questions? Toll Free: (800) 850-2504

Southwest Florida
Chelsea LaRue: (727) 415-2185

South Florida
Beth Herdegen: (305) 331-7085
North & Central Florida
Patty Ingram: (352) 857-6398
Community Advantage Program Manager
Michael Frid: (727) 723-4003