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Who should apply and who is eligible for a CDC/504 Loan?



What is the SBA’s CDC/504 Loan Program?

Business owners seeking funds up to $1M to renovate or buy a building or to put major equipment in place may find that applying for a 504 loan makes sense. SBA expects these funds to create or retain jobs or meet certain public policy goals. Generally companies that meet these public goals fall into categories such as: an empowerment zone, minority-owned business, export or manufacturing company, or a company whose expansion will contribute to rural development.



Under the 504 Program, the business qualifies as small if it does not have a tangible net worth in excess of $7.5 million and has an average net income of less than $2.5 million after taxes for the preceding two years. The 504 loan is designed for “brick and mortar” type expenditures, such as;

  • New construction and contingency fund
  • Purchase existing buildings
  • Leasehold improvements
  • purchase land and improvements, such as paving streets, utilities, parking lots and landscaping
  • renovation of building or converting existing facilities
  • purchase heavy duty machinery and equipment that has a useful life of 10 years or more
  • Business Acquisition & Expansion
  • Partner Buyouts, Start-ups (experienced only) & Turn-Arounds
  • Soft costs directly connected to the project, such as, consultant (ABC), legal, accounting, survey, architect, engineering, environmental, appraisal, title search, permits fees, etc.