An SBA 504 loan can be used to provide long term permanent financing to acquire, construct or refinance hotels. As a direct lender, our team can structure an SBA 504 loan and obtain SBA approval in a timely and efficient manner.
How Do SBA 504 Loans Work?
A 504 project is funded by a Stonehill loan, secured with a first lien, typically covering 50 percent of the project’s cost; a loan from a CDC secured with a second lien and backed 100 percent by SBA, covering up to 30 percent of the cost: and an equity contribution by the Borrower of 20 percent of the project cost. The Stonehill loan can be a fixed or variable rate and typically is amortized over 25 years. The CDC loan is fixed rate, and its term is 20 or 25 years.
Our extensive experience and expertise in the hotel industry and knowledge of SBA program rules and regulations allows us to quickly determine if your project meets program guidelines. We work with you every step of the process from initial application to disbursement of your funds, allowing you to enjoy the personalized service needed to achieve your financial goals.
To learn more about the SBA 504 loan program and eligibility requirements, contact us. We look forward to financing your hotel.
|Amount||$2 million to $15 million|
|Rate||Variable 6.5% to 8.5%|
|Purpose||New Construction, Acquisitions and Refinances|
|Loan To Value||Up to 85% LTV|
|Loan To Cost||Up to 85% LTC|
|Loan Term||10 years|
|Guarantees||Required of all 20% or more owners|