SBA Loan Options

CB&T offers both the SBA 7(a) and SBA 504 Loan programs. With up to 90% financing, low interest rates and terms up to 25 years, the SBA 504 Loan can help business owners purchase or build a facility while preserving more capital. It’s ideal for companies that are expanding or opening a second location. In general, SBA 7(a) loan proceeds can be used to purchase, construct, expand or convert industrial and commercial buildings. With maximum loan amounts up to $2 million, these loans offer extended terms up to 25 years and below-market interest rates.

To learn more about these loans, refer to the chart below. You can also contact a CB&T SBA Specialist to discuss our SBA loan options.

Use

SBA 7(a) Loan	SBA 504 Loan
Commercial real estate purchase, construction, improvements	Commercial real estate purchase, construction, improvements
Occupancy requirements 51% Existing building 60% Initially for new building construction	Occupancy requirements 51% Existing building 60% Initially for new building construction
Debt refinance
Leasehold improvements
Equipment purchases
Business expansion
Business acquisition/start-up
Working capital

Loan Amounts

SBA 7(a) Loan	SBA 504 Loan
Up to $2,000,000	Up to $5,000,000
Commercial real estate purchase, construction, improvements	Higher loan amounts considered on a case by case basis

Terms

SBA 7(a) Loan	SBA 504 Loan
Up to 25 years amortization	Up to 25 years amortization
Up to 90% financing on general purpose real estate	Up to 90% financing on general purpose real estate
Up to 85% financing on special purpose real estate and construction	Up to 85% financing on special purpose real estate and construction

Interest Rates

SBA 7(a) Loan	SBA 504 Loan
Fixed or adjustable rates	Fixed or variable rates

Eligibility

SBA 7(a) Loan	SBA 504 Loan
SBA 7(a) - Basic Eligibilty Requirements	SBA 504 Loan - Basic Eligibilty Requirements

General Underwriting Criteria

SBA 7(a) Loan	SBA 504 Loan
Management expertise	Management expertise
Debt repayment ability, good credit	Debt repayment ability, good credit
Collateral - Business and/or personal assets	Well-capitalized business, record of profitability
Acquisition or expansion requires a minimum of 20% capital injection	Collateral - Bank up to 60% loan-to-value. CDC/SBA up to 40% loan-to-value, not to exceed 90% maximum combined financing
Start-up businesses require a minimum of 30% capital injection and a business plan with projections

Fees

SBA 7(a) Loan	SBA 504 Loan
No bank points	Bank - Based on individual credit request
SBA fee is based on loan amount	Debenture - Fee set by CDC
Loan packaging fee
Prepayment penalty for the first 3 years for loans with maturities of 15 years or more.

Benefits

SBA 7(a) Loan	SBA 504 Loan
Longer maturity and amortization than conventional financing	Financing availability
Consideration is given for mixed collateral	Competitive interest rates
Loan to value is higher than conventional financing	Low down payment conserves working capital
Financing available for start up businesses	Fixed rates available
Debt coverage can be based on projected cash flow	Long-term amortization
May be used for refinances
May be used for working capital
No pre-payment penalty on loans with terms under 15 years

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