SBA amends 504 loan program - The Business Review (Albany):

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The permanent change was authorized by the Americanb Recovery and Reinvestment Actof 2009. It is the latesr of several SBA programm modifications contained in the stimulus plan totake effect. Othera have included a temporary increaswe in the guarantee level onmost 7(a) progra m loans, reduced fees on both 7(a) and 504 loans, and a doublingf of the surety bond guarantee level for small businessesa competing for construction and service contracts. The 504 program provides financing for smallk businesses to purchase real estate and otherrfixed assets, such as heavy equipment or machinery, and to expandx an existing development project.
The loans are made partially by banks and partially by a Certifie dDevelopment Company, with the borrower puttingf in 10 percent. In the Albany, N.Y. area, most 504 loane go through Under therevised rules, 504 loansz now may be used to refinancse existing loans used to buy real estate and other fixed assets. The refinancing must be tied to abusineszs expansion, and the debt refinancef may not exceed 50 percent of the projectedc cost of that expansion.
An includes any project that involves the construction or improvement of building or equipment for use by thesmall “This is one more piece of the Recovery Act that is goinvg to have a direct impact and put more money in the handss of small business owners just when they need it most,” said SBA Administratodr Karen Mills. “Lower interest ratees mean lower payments and less money going out the door each montjh indebt repayments. That means more cash on hand to keep theirfdoors open, their employees working and to even expanr and create more jobs.
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