Small Business Administration 504 Program

Nick’s Steak & Seafood, Hilton Head, SC -SBA

The SBA 504 Business Loan Program provides partial financing for land, buildings, and machinery and equipment. SBA 504 funds range from $50,000 to $5,000,000 and are available to businesses in South Carolina. These funds generally can be used, in conjunction with bank financing, to fund up to 90% of eligible project costs. The SBA funds up to a maximum of 40% of the project.  A competitive interest rate and 10, 20, or 25 year term can significantly lower overall debt service providing improved cash flow for the business. The interest rate is fixed for the term of the loan.

Current interest rates for October 2020 are: 25 year – 2.430%; 20 year – 2.396%; 10 year – 2.288%

Application Process

The application process includes submitting projections, business financials, personal financial statements, and an outline of project costs. Business Plans are required for start-up companies. Cash flow, credit history, and collateral will be considered in the loan review process.

SBA 504 funds combined with bank financing can be a powerful economic development tool. These funds are available to new and expanding businesses for the purpose of increasing the local tax base and creating jobs.  Owner injection is required.

Eligible Companies

For profit industrial, commercial, service, and retail companies are eligible for SBA 504 funds. Job creation is a key component to the program, requiring creation of one permanent job for every $75,000 of SBA funds loaned.

General Guidelines:

  • Loan Amounts – $50,000 – $5,000,000 (Manufacturing firms up to $5,500,000)
  • Interest Rate – Fixed
  • Term – 10, 20, or 25 years
  • Maximum Loan Amount – Up to 40% of Project
  • Legal Fees – Varies
  • Prepayment Penalty – Applies only during first half of loan term
  • Job Creation – One permanant job within 2 years for every $75,000 of SBA 504 funds loaned; may be less if the project meets federal public policy goals

Uses for Loan Funds – Land, Building Construction, Building Expansion, Machinery, and Equipment.

For additional information on the SBA 504 Program, please contact Randy Pellisero or Ed Brock at 803-327-9041.

Link to Loan Application

Link to the Small Business Owner’s Guide to the CARES Act

SBA 504 Flyer