Small Business Loan 504

Small Business Loan 504

If you own a small business, or you're trying to start a business, you know how difficult it can be to obtain the financing you need to grow and prosper. Working with the Small Business Administration (SBA), we are able to offer loans to meet your specific needs. Imagine the possibilities with a SBA loan from State Bank of Countryside!


The 504 loan program has long-term, fixed-rate financing and is used to acquire fixed assets for expansion or modernization. Use proceeds to purchase long-term machinery, existing buildings, or land; make land improvements; build new facilities or modernize, renovate or convert existing ones. NOTE: The 504 Program cannot be used for working capital or inventory.

Source of FundsExisting Business AND
Multi-Purpose Facility
Start up Business AND
Single Purpose Facility
SBC LoanUp to 50% of project costUp to 50% of project cost
SBA 504 Loan (through CDC)Up to 40% of project costUp to 30% of project cost
Borrower's EquityAt least 10% of project costAt least 20% of project cost
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Summary

How the Program Works:

Every 504 project requires the participation of a Certified Development Company (CDC). CDCs are authorized by SBA to provide second-lien financing behind a first-mortgage lender, such as State Bank of Countryside. The following are typical structures for projects utilizing the 504 program.


Source of FundsExisting Business AND
Multi-Purpose Facility
Start up Business AND
Single Purpose Facility
SBC LoanUp to 50% of project costUp to 50% of project cost
SBA 504 Loan (through CDC)Up to 40% of project costUp to 30% of project cost
Borrower's EquityAt least 10% of project costAt least 20% of project cost

(Note: SBA considers a business less than two years old to be a start up.)


Use of Companion SBA 7(a) Loans:

The 504 and 7(a) programs can be used in conjunction. For example, a 504 loan can be used to construct a building, and a companion 7(a) can be submitted simultaneously to finance machinery and equipment, inventory, working capital, etc.


Click Here for more information on 7A Loans.

Click Here for a Small Business Loan Application Packet.

Terms of Loans

SBA Loans feature fully amortizing notes with no balloons.


Other Requirements:

1. As a general rule, loans for business purposes and real estate acquisitions require an equity injection depending on the asset being financed.


2. Applicants for SBA loans must be citizens of the United States, or have legal permanent residence status. Also, the owners/principals of the business must be of good character. Any prior arrests or criminal charges must be disclosed.



3. The SBA charges a guaranty fee that must be paid at the time the loan is funded. However, the guaranty fee can be paid from loan proceeds.

How to Apply

How to Apply:


1. Gather basic information concerning your business and loan request. A list of minimum required information is provided on the tab labeled Terms of Loans.


2. Contact Raj Badri at 708-485-9981 or Raj.Badri@banksbc.com to schedule an appointment to discuss your loan request.