Obama Supports 150% Increase in Maximum 504 Loan -- to $ 5 Million

Oct. 21, 2009 -- President Obama today announced his support of legislation that will increase the cap on Small Business Administration (SBA) 504 loans to $5 million for standard small businesses and $5.5 million for small manufacturing businesses. 504 loan caps are currently set at $1.5 million ($2 million if a public policy is met) and $4 million, respectively.

The shift to $5 million for standard small business borrowers would support a total project of $12.5 million, and to $5.5 million for small manufacturers would support a total project of $13.75 million, according to the White House and the SBA.

While the legislation is pending Congressional approval, this is huge news for small business owners looking for financing who were unable to obtain a 504 loan due to $1.5 million cap. In many cases, these small businesses had already used a 504 loan, they were ready to expand, but were denied the chance to borrow again through the SBA due to the $1.5 million limit.

SBA data shows an increase in the demand for the larger loans currently available. In the 504 program, the percentage of loans for more than $1.5 million has grown, from 15% of total dollars approved in 2005 to 28% in 2009.

Obama made his announcement at the offices of Metropolitan Archives, a 504 loan recipient in Hyattsville, Maryland. With this kind of support from the president for the 504 industry, it is certainly hoped the legislation will be fast tracked and put into place by the SBA as soon as possible.

The 504 loan program is reserved exclusively for the purchase, construction or renovation of owner-occupied commercial real estate and/or the acquisition of industrial equipment or other fixed assets. It offers below market, fixed interest rates with long amortization terms (up to 20 years).

Over 115,000 savvy, small business owners have taken advantage of 504 loans to grow their businesses since the program began in 1986. In fact, the 504 loan program has funded over $45 billion in loans to growing small businesses over the past 23 years.

Click here for the White House release.

Click here for President Obama's speech transcript.

Commercial Capital Limited
SBA Financing Program

We here at Commercial Capital Limited are experts in Small Business Administration 504 loans and are able to assist all our clients in getting SBA loans closed faster, easier and at lower costs. Don’t hesitate to call or email Commercial Capital Limitied to see how we might be able to assist you and your business in receiving some of the additional Stimulus Bill money that has been made available thru the Small Business Administration.!

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You typically DO need experience in a business if you are applying for an SBA business loan. For example, if you were applying for an SBA loan to purchase or start a manufacturing business, you’d have to show that you have the experience to run that type of business to get approved.

You also need 2 years minimum of business operations to apply for an Unsecured Business Line of Credit and for our 100% Commercial Loans for expanding businesses.

But for financing of commercial real estate there is no minimum length of time you have to be in any particular type of business. You do not have to currently own a corporation or an LLC. You could purchase an apartment building or office building or strip center without ever having owned one of those types of properties as long as the income from the property was more than enough to cover the projected debt from the new financing.

And coincidentally, we are one of the few places you’ll find in the country that can provide you with a “blanket” mortgage covering 5 or more residential and/or commercial properties. So we’d love to talk to you about how we might be able to assist you with refinancing some of those properties and replacing a whole lot of little mortgages with one or two big ones and under much better terms. Or to help you purchase a group of individual properties with one loan.

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Regards,.

Tony DeCresie
Your #1 Source for Commercial & Business Financing
Office: 863-298-8900 eFax: 863-877-4456 Cell: 813-833-3132
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