Top 5 Reasons to use a 504 Loan…
1. Low Down Payment
The 504 Loan program offers financing for up to 90% of project cost, this means as little as 10% is required as down payment unlike traditional loans requiring 20% – 30%. That is a lot of savings that can go towards your businesses working capital.
2. Long Term Financing
With a 20 year term loan, no refinancing needed in 5- 7 years. Small business owners can predict financing expenses when the economy is good and bad.
3. Fixed Competitive Interest rates
Interest rates are based on current debenture rates. The actual interest rate a borrower pays is calculated on the debenture rate for the month the loan is funded. Rates fixed for 20 years take the guess out of future expenses along with unknown market instability or fluctuating rates.
4. Flexibility & Security
Borrowers can build equity and invest in their businesses financial future, added with the flexibility in deciding how to hold the title to their facility, owners can put the title in their personal name, or businesses name to maximize tax benefits of ownership and minimized liability in the manner best suited for the company.
5. Government guarantee
The 504 Loan program was created to increase accessibility of business property loans to enhance the economic health of local communities. Lenders risk is reduced through government guarantees, increasing borrowers accesses to financing.