There is a relatively new SBA program out there that is really good and you should know about it., It is the SBA 504 program.

This is not the old SBA 7A program where the SBA guaranteed the loan for the bank. This old program is why SBA loans have a bad reputation. The new program is a dramatic improvement - so forget about the old program and welcome the new.

The basics are this:

• The buyer puts 10% down.
• The primary lender loans at 50$ LTV.
• The SBA provides a second mortgage of 40% LTV (20 year, fixed interest)

Only end users are eligible. Investors are not eligible

Typically, all of the closing and inspection costs can be rolled into the contract price and the Buyer pays 10% of this total, so the up front out of pocket costs are minimized. In the same fashion, building improvement, architectural, professional fees and capital equipment purchases can be rolled in.

Paperwork requirements are similar to those of a regular loan from a bank. In fact, you can generally submit the same paperwork prepared for the bank to the SBA group.

My experience so far suggests these take about 60 days from start to finish for deals under $1,500,000. This is far better than the old 7A program and a welcome change.

If you are considering a Commercial Real Estate Purchase for your business, this is the best game in town.

If you need more information, please call. I have the full application package available.