When you need a large amount of money to purchase real estate or fixed assets, 504 loans are the answer. Here’ what you need to know about this useful financing solution.
What Are 504 Loans?
504 loans provide long-term financing for major business purchases, like real estate or large equipment.
With fixed rates and repayment terms that range between 10 and 25 years, 504 loans are a solid financing alternative for businesses that meet the requirements (more on that later on).
What Can I Use a 504 Loan For?
A 504 loan can be used for a range of purposes, with the common denominator being that it should promote business growth and job creation.
This type of loan can be used for the purchase or construction of:
- Existing buildings or land
- New facilities
- Long-term machinery and equipment
Or to improve or modernize:
- Land, streets, utilities, parking lots, and landscaping
- Existing facilities
Keep in mind that a 504 loan CANNOT be used for working capital or to purchase inventory, to consolidate or refinance debt, or for speculation/investment on real estate.
If your requirements don’t fall within these specifications, don’t worry—there are other financing options available. Contact the experts at Gellyfish today to find a solution that works for you.
What Businesses Are Eligible for a 504 Loan?
While most businesses are eligible for a 5054 loan, there are some requisites that must be met. In order to be eligible for a 504 loan a business must:
- Operate as a for-profit company in the United States or its possessions
- Have a tangible net worth of less than $15 million
- Have an average net income of less than $5 million after federal income taxes for the two years preceding your application
Other general SBA requirements also apply, including meeting SBA size guidelines and having a feasible business plan, among others.
Generally speaking, businesses not eligible for this type of loan include pyramid schemes, businesses engaged in legal gambling, and those dedicated to lobbying or speculation.
Gellyfish: Certainty of Execution in SBA Loans
Looking for SBA loans in California, or anywhere in the United States? Gellyfish is here to help. We offer financing with the certainty of execution you need to take your business to the next level.
Contact us today by email (firstname.lastname@example.org), telephone (877-800-4493), or social media (Facebook, Twitter, LinkedIn), to schedule a free consultation or to learn more about our full range of financing options.