Partners 1st Federal Credit Union, working in partnership with the Small Business Administration, provides SBA 504 Program financing for fixed assets – real estate, machinery, and equipment. Whether making the move from leased space to owning a building; expanding or improving operations; or purchasing new equipment, the 504 loan can be a powerful financing tool.

A few examples of past SBA 504 projects:

  • Manufacturing Operations and Warehouses
  • Hotels
  • Self-Storage Facilities
  • Restaurants and Bakeries
  • Car Dealerships and Repair Shops
  • Gas Stations and Convenience Stores
  • Doctors, Dentists, Optometrist, and Veterinarian offices
  • Grocery Stores

Why Partners 1st Federal Credit Union
Partners 1st Federal Credit Union is a locally based source of funding for our Member’s business needs.  We work with our Member’s to find the best loan structure, and our experienced staff is focused on providing friendly, efficient, and timely service to help our members achieve their goals.  If the SBA 504 program is not the right fit Partners 1st also offers attractive conventional commercial financing terms as well.

How It Works
Partners 1st Federal Credit Union guides clients through the 504 application process.  Once we have completed the application package your credit union works with a Certified Development Company to get the SBA involved. Once approved, the Credit Union provides a conventional loan for 50% of the project, and the Certified Development Company (SBA) provides 40% of the financing with our member contributing the remaining 10% of the project.

The SBA 504 Loan Offers Great Terms

  • Long term fixed rate: 25 years for real estate; 10 years for equipment
  • Low down payment of 10% in most cases
  • Competitive interest rate
  • Most of the fees can be financed into the loan

Benefits of the 504 Program

  • Up to 90% financing for a project when usually 70% - 80% is typically available through conventional commercial loan financing.
  • The lower down payment requirements preserves working capital needed for daily operations.
  • A longer term translates into lower payments, further reducing the burden on cash flow.
  • A significant portion of the project is financed with a long term fixed rate providing borrower protection against rising rates.

 Use of CDC/504 Loan Proceeds

Eligible uses of funds:

  • The purchase of land
  • Acquisition of existing buildings
  • Fixed assets from business acquisition
  • Building expansion or renovation
  • The purchase of improvements, including grading, street improvements, utilities, parking lots and landscaping
  • The construction of new facilities
  • The purchase of long-term machinery and equipment
  • Debt refinance (Expansion Projects – debt refinance may not exceed 50% of the new expansion costs)
  • Professional fees, Lender’s interim points & interest

Ineligible uses of funds:

  • Working capital or inventory
  • Goodwill assets from business acquisition
  • Franchise Fees
  • Tenant improvements
  • Speculation or investment in rental real estate


Occupancy Requirements

  • 51% for existing facilities / building
  • 60% for ground-up construction projects (Must occupy 80% within 10 years)

Maximum Loan

  • $5.0 Million (Typical Project)
  • $5.5 Million (Manufacturers)
  • $5.5 Million (if Certain Energy Public Policy Goals Are Met)
  • No Maximum Limit Placed on Participating Lender's Loan Portion

Borrowers Investment

  • 10% in Most Cases
  • 15% for Start-Up Businesses (Less Than Two Years In Operation) or Special-Purpose Properties
  • 20% if The Project is Both a Start-Up and Special-Purpose Property
  • Equipment-Only Loans may Qualify with 10% or 15% Injection

CDC/504 Loan Application Process

Once you have decided to apply for an SBA 504 loan we will walk you through the application process and collect the appropriate documents for your application.

Call the team at Partners 1st Federal Credit Union to get the process started.