SBA 504 Loan Program

The SBA 504 Loan Program is designed to help small business owners acquire fixed assets — commercial real estate and/or long-life machinery and equipment — without the financial hassles and high cash outlay requirements often associated with conventional financing programs.

Program Highlights:

• Up to 90% commercial financing at below-market, fixed interest rates
• Low down payment (usually 10%) preserves working capital
• Long amortization terms (up to 20 years on real estate and 10 years on equipment)

Loan Structure:

• Commercial bank provides financing for 50% of the project (first lien position)
• PADD delivers up to 40% of the project financing/SBA portion (second lien position)
• Small business owner provides down payment of 10% (or up to 20% equity for start-ups or special-purpose structures)

Eligible Uses of Proceeds:

• Purchase, construction, expansion, or renovation of commercial real estate
• Acquisition and installation of long-life machinery and equipment
• Green initiative projects (sustainable design, reduced energy consumption, renewable energy or fuels)
• Purchase of furniture, fixtures, and equipment
• Associated and soft costs (attorney's fees, architectural, engineering, surveys, etc.)
• Debt refinancing

Borrower Injection Requirements:

• 10% in most cases
• 15% for start-up businesses (less than two years in operation) OR special-purpose properties and real estate
• 20% if the project is a start-up AND special-purpose property
• Equipment-only loans may qualify with 10% or 15% injections

Geographic Scope: Purchase Area Development District (8-county region in far western Kentucky)

Contact Information:

• Phone: 270.247.7171
• Email: Available on website
• Address: 1002 Medical Dr / PO Box 588, Mayfield, Kentucky 42066