SBA 504 Loan Program Cincinnati, OH

If you are a business owner looking to purchase a building or large piece of equipment in Cincinnati, OH, it’s essential to find a reliable, affordable loan. The SBA 504 program is an effective way for businesses to benefit from a low, fixed interest rate with a loan term of up to 25 years. Plus, you can put as little as 10% down.

The SBA 504 program is designed to make fixed asset purchases affordable and accessible to businesses of different sizes, so they can grow and better serve their communities. If you’re curious how the SBA 504 program works, let’s dive in. 

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Loan Rates (as of November 2023) 
View Historic Rates >

25 Years:
as low as

7.01%

20 Years:
as low as

7.02%

10 Years:
as low as

7.21%

How does an SBA 504 Loan work?

The SBA 504 loan program gives businesses in Cincinnati long-term, fixed-rate financing up to $5.5 million for major fixed assets, notably owner-occupied real estate and large equipment. In some cases, this program can be used for refinancing debt accrued for these types of purchases.

Part of what makes this program unique is the partnership between the bank and the certified development company (CDC) like Alloy. The bank funds 50% of the total cost, the CDC funds up to 40%, and the business owner makes a 10% down payment on the project.

 

SBA 504 Loan Example

Let’s say you’re taking out an SBA 504 loan for a $2 million project. The funding would look like this:

  • Bank Loan: $1 million
  • SBA 504 Loan: $800,000
  • Business Down Payment: $200,000

Loan Details

The details of an SBA 504 loan include:

  • Terms: 10, 20, and 25 year terms are available to business owners.
  • Loan Rates: There is a below-market rate that is fixed for the entire life of your loan.
  • Amount: Loan amounts range from $50,000-$5.5 million.
  • Timeline: After the completed loan application receives SBA approval and escrow is closed, your loan becomes part of the regular monthly debenture sale. It takes about a month from the time Alloy submits your funding documents until the debenture sale occurs. When that is completed, you will be notified of your final below-market loan rate.

What Can I Use an SBA 504 Loan For In Cincinnati, OH?

The SBA 504 loan can be used by businesses across various industries. You can use this program for:

  • Purchasing land and constructing a business location.
  • Purchasing owner-occupied real estate (storefront, office building, etc.)
  • Purchasing heavy equipment or machinery.
  • Using the loan as a business construction loan to renovate or improve your owner occupied real estate.

Do I Qualify for an SBA 504 Loan?

If you are a business owner in Cincinnati looking to fund a commercial real estate project or fixed asset purchase, you may be eligible for the SBA 504 loan program. The basic requirements for this program include:

  • You must be a for-profit, operating business.
  • You must be located in the United States.
  • You must have a tangible net worth under $15 million and after federal taxes, you must have an average net income of less than $5 million for the previous two years.

 

OR you must meet the SBA size standards for your industry.

  • You must demonstrate a need for credit.
  • The building you want to finance must be 51% owner-occupied for purchases and 60% for new construction.

 

To see if you qualify, reach out to us and we can help you with the application process. The professional lenders at Alloy can help you navigate the application process and ensure you’re thoroughly prepared. The timeline for receiving approval depends on various factors, including the type of loan request and how prepared you are. Commercial real estate applications can take 60-90 days (or longer) if construction is involved.

About Cincinnati, OH

Nestled along the Ohio River, Cincinnati, Ohio, is a city of bridges and hills that boasts a rich cultural heritage and a thriving culinary scene. With iconic attractions like the Cincinnati Zoo, vibrant neighborhoods like Over-the-Rhine, and professional sports teams, it offers residents and visitors an exciting mix of tradition and contemporary urban living.

Why Choose Alloy Development Co.?

If you live in Cincinnati, OH and are interested in the SBA 504 program, Alloy is here to help. Alloy Development Co. has established itself as a leading force in the regional economic development landscape. As the leading CDC in the states of Ohio and Kentucky, our experience and impact speak for themselves. With a dedicated team of professionals, we are here to help your small business access capital to facilitate growth.

Whether you are curious about how an SBA 504 Loan can help your business or want to begin obtaining funds, let us serve as your trusted advisor. Contact us today to learn more.

SBA 504 Loans FAQs

Answers to the most common questions

Yes, refinancing is an option available under the SBA 504 Loan Program. According to the guidelines provided by the Small Business Administration, eligible small businesses can use the proceeds of an SBA 504 loan to refinance their existing commercial mortgage debts in certain cases. This option can be incredibly beneficial for business owners looking to lower their interest rates or extend their repayment terms, thus easing their financial burden and enhancing cash flow.

If you answer yes to any of the below questions, the SBA 504 refinance program may be a good solution to fit your needs:

  • Do you own an owner occupied commercial building and have a pending balloon payment?
  • Do you want to reduce your monthly payments and increase cash flow?
  • Do you need access to cash?
  • Do you have an existing commercial real estate loan but want to fund improvements or an expansion to your building?
  • Almost any owner-occupied property will qualify: minimum 51% owner-occupied and meet all other SBA 504 eligibility guidelines at time of application
  • Existing loan must be at least 6 months old
  • Business must be at least 2 years old
  • At least 85% of existing loan must have been for SBA 504-eligible purposes
  • Loan may be subject to a federal agency guarantee (meaning existing SBA 504 or 7(a) loans may be eligible) but the original lender must be unwilling to adjust the terms
  • Other assets can be used as collateral to get to 90% LTV
  • Up to 20% of the appraised value can be used for cash out for other business expenses
  • Appraisal not due at application, but will be required for funding

SBA 504 Loan Toolkit

Our experienced staff is here to help you find the right solution to your needs and help you navigate what we have to offer

Current Rates

Interest rates are based on the 10 year Treasury Rate plus a spread. Rates vary depending on the time of the SBA loan closing and loan amount.
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Loan Calculator

Use the current rates to calculate what your potential project might cost using the SBA 504 Loan program.
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Historical Rates

Rates fluctuate over time, this document illustrates the trends of rates over time.
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Frequently Asked Questions

Answers to your frequently asked questions regarding the servicing of your current loan.
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Call our loan experts today at 513-631-8292 to find the right solution for your needs

Ready to get started on your new real estate project? Download Applications

Additional Loan Products We Offer

SBA-ILP Loan

Alloy Commercial Capital is one of 37 lenders nationwide to be selected by the U.S. Small Business Administration (SBA) to administer the SBA’s Intermediary Lending Pilot Program.
Learn More >

Ohio Regional 166 Loan

This program assists growing businesses in acquiring machinery, equipment, and real estate through a partnership between business owners, conventional bank financing, and Alloy Commercial Capital.
Learn More >

SBA 504 Refinance Program

This program allows you to refinance debt that you previously incurred for commercial real estate and fixed-asset projects at below-market rates.
Learn More >

Talk to one of our loan experts today to find the right solution for your needs

Or give one of our expert loan officers a call at 513-631-8292 for more info.

“Alloy walked me through the SBA 504 loan process every step of the way, which I really needed since I had never purchased commercial real estate before. They also helped me out with a tricky leased land situation that helped pave the way for future commercial real estate purchases.”
Steve Dorgan
President, Wray Precision, SBA 504 Loan Borrower
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