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SBA 504 Refinancing Program
The standalone SBA 504 Refinancing Program is a temporary program that allows the SBA 504 Loan to be used for refinancing conventional loans, so long as a series of specific criteria is met. The program is authorized through September 27, 2012.
The following checklist outlines some of the key requirements for refinancing projects: SBA 504 Refinancing Program Eligibility Checklist
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The debt to be refinanced was incurred not less than two years prior to application.
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Loan being refinanced has been current for the past 12 months with no payment being deferred or past due for more than 30 days (an account transcript for the entire period of the loan is required).
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Existing loan is secured by 504-eligible assets (fixed assets, including real estate and long-term machinery and equipment). No loan proceeds will be used for new purchase or expansion
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All of the original loan proceeds were used for the benefit of the small business, and at least 85% of the original loan proceeds were used for 504-eligible purposes.
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The loan to be refinanced is not part of an existing 504 project, or any loan with an existing federal guaranty (i.e. 7a loan or USDA loan). No loan to be refinanced is due to associates of the borrower, a Small Business Investment Company (SBIC) or a New Market Ventures Capital Company.
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The business will have been in operation for two years prior to application.
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Total of new Third Party and SBA loans will not exceed 90% of the fair market value of the fixed assets securing the loans.
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The small business will retain one job/$65,000 of SBA funding ($100,000 for manufacturers)
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The existing creditor is not in a position to sustain a loss. The Third Party Lender will certify to having no knowledge of default or likelihood of default by the borrower.
Please see our Program Updates page for more details about the SBA 504 Refinancing Program.
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