SBA 504 Program

Holyoke Credit Union offers the SBA 504 Program to encourage business expansion and job creation. This unique program provides up to 90% long-term, fixed-rate financing for real estate acquisition, renovation, expansions, and equipment purchases. The SBA 504 Program is available to small to mid-sized businesses with employees.

Features

Available for a variety of uses, including the purchase of existing property or land, as well as new construction
90% financing (10% down payment)
Owner-occupied real estate and equipment
Below-market fixed rates
Financing available for many SBA-related fees/closing costs
20-year fixed rate and 10-year fixed rate on equipment (on the SBA second loan)

Eligibility

Most for-profit businesses (corporation, partnership, or proprietorship)
Operating company must occupy 51% of existing building or 61% with new construction
The net worth of a business must not exceed $15 million and the net income after taxes cannot exceed $5 million.
The average net profit after taxes must not exceed $2 million (average over the last two years). Check with an SBA specialist if maximums are close or exceeded.
Maximum project size is $6 million for non-manufacturers and $10 million for manufacturers.
Equity requirement is 10%. An extra 5% is required for a start-up business (two years or less) or a single-purpose building (10% additional if both are applicable).

Loan Uses

Purchase or renovation of an existing owner-occupied building
Modernization, renovation, or restoration of a building, including household improvements
Purchase of equipment with economic useful life of 10 years or more
Other attendant soft costs such as accountants, engineers, appraisers, construction period interest
Purchase of land
10% contingency on a real estate construction project

Ineligible use of proceeds

Working capital
Debt consolidation or repayment
Inventory
Refinancing (though you may be able to refinance an existing first mortgage of an existing SBA 504 deal)

How to Apply

Three easy ways to apply: