SBA 504 loans
SBA 504 financing supports major fixed assets through a Certified Development Company (CDC) working with a senior lender. The usual SBA 504 limit is $5 million; eligible manufacturing and energy projects can reach $5.5 million. These limits concern the 504 loan, not the total project financing. SBA: 504 loans; eCFR: 13 CFR 120.931. Last checked .
GrantCalendar is not a lender and doesn't arrange loans. Information only. No loan affiliate links or loan lead forms.
Maximum 504 loan amounts
The $5 million limit generally applies to the borrower and affiliates’ outstanding 504 balance. The $5.5 million per-project limit covers qualifying small manufacturers with all production facilities in the U.S., projects reducing energy use by at least 10%, and qualifying renewable-energy projects. eCFR: 13 CFR 120.931. Last checked .
Who can apply
A 504 applicant must be an operating, for-profit U.S. business meeting SBA size requirements and the eligible-business rules. SBA also identifies qualified management, a feasible business plan and repayment ability. Contact a CDC to check the complete requirements for the project. SBA: 504 loans. Last checked .
Nonprofits, speculative businesses and many passive investment businesses are excluded from SBA business lending under 13 CFR 120.110. The regulation lists additional exclusions and exceptions; review them with the lender. eCFR: 13 CFR 120.110. Last checked .
Eligible assets and excluded expenses
504 proceeds can finance buildings or land and qualifying machinery with at least ten years of remaining useful life. Some debt refinancing is allowed under specific rules. Working capital, inventory, speculative rental-real-estate investment and ineligible debt refinancing are excluded. SBA: 504 loans. Last checked .
Interest-rate rules and repayment
The CDC/SBA portion provides long-term fixed-rate financing, with 10-, 20- and 25-year terms. SBA describes the rate as an increment above the market rate for ten-year U.S. Treasury issues. The separate senior-lender loan has its own terms; its rate must be reasonable and cannot exceed SBA’s published third-party-lender maximum. Request quotes for both portions. SBA: 504 loans; eCFR: 13 CFR 120.921. Last checked .
FY2027 fees and other costs
For FY2027 approvals, the ordinary 504 upfront guarantee fee is 0.50%, with an annual service fee of 0.203% of the outstanding balance. Debt refinance without expansion ordinarily uses 0.204% annually. The notice waives these two SBA fees for manufacturers in NAICS sectors 31–33, specified food-supply-chain businesses and rural businesses, including eligible refinancing. A waiver of these fees does not establish that all closing costs are waived. SBA: FY2027 504 fee notice (PDF). Last checked .
Separate CDC charges can include a processing fee of up to 1.5% of net debenture proceeds, reasonable closing costs and ongoing servicing charges. The regulation sets limits and approval requirements; ask the CDC for the full itemized project costs. eCFR: 13 CFR 120.971. Last checked .
How to apply and prepare documents
Start with SBA’s CDC directory or a local SBA office. A CDC guides the 504 application and lender financing; discuss the project, its eligibility and the documents required before applying. SBA uses Form 1244 to review 504 eligibility; obtain the current form and required supporting exhibits from your CDC. SBA: 504 loans; SBA: Form 1244 for 504 applications. Last checked .
Prepare a business plan, requested amount and proposed use of funds, financial projections, credit information and details of possible collateral. SBA also recommends working with a resource partner to organize tax returns and bank statements. The lender supplies the final document checklist. SBA: Lender Match; SBA: financial preparation; SBA: 7(a) loans. Last checked .
Questions about SBA 504 loans
Can a 504 loan pay for working capital or inventory?
504 proceeds can finance buildings or land and qualifying machinery with at least ten years of remaining useful life. Some debt refinancing is allowed under specific rules. Working capital, inventory, speculative rental-real-estate investment and ineligible debt refinancing are excluded. SBA: 504 loans. Last checked .
Is $5.5 million available for every 504 project?
The $5 million limit generally applies to the borrower and affiliates’ outstanding 504 balance. The $5.5 million per-project limit covers qualifying small manufacturers with all production facilities in the U.S., projects reducing energy use by at least 10%, and qualifying renewable-energy projects. eCFR: 13 CFR 120.931. Last checked .
Where do I apply for a 504 loan?
Start with SBA’s CDC directory or a local SBA office. A CDC guides the 504 application and lender financing; discuss the project, its eligibility and the documents required before applying. SBA uses Form 1244 to review 504 eligibility; obtain the current form and required supporting exhibits from your CDC. SBA: 504 loans; SBA: Form 1244 for 504 applications. Last checked .
Official SBA help
SBA’s Lender Match is a free online tool for connecting small businesses with prospective lenders. SBA: Lender Match instructions (PDF). Last checked .
SBA district offices and resource partners help with business planning and applications. The local-assistance directory includes Small Business Development Centers, SCORE, Women’s Business Centers and Veterans Business Outreach Centers, with free or low-cost counseling and training. SBA: local assistance; SBA: 7(a) loans. Last checked .
Each fact links to the official source checked on the date shown. Confirm the requirements and costs for your application with SBA or the participating lender.