SBA lenders
CDC Small Business Finance
CDC Small Business Finance is a nonprofit lender headquartered in San Diego and part of the Momentus Capital family of organizations. It makes SBA 504 commercial real estate loans and smaller business loans, and pairs lending with business advising before and after the loan.
SBA 504 financing runs from $250,000 to $30 million or more. The structure puts a bank or other lender in first position for 50 percent of the project, CDC in second position for 40 percent at a fixed rate, and the borrower in for a 10 percent down payment. Terms of 25, 20 and 10 years are offered, along with refinance and manufacturing variants, and the rate for each monthly funding cycle is published on the site. Separate small business loans range from $30,000 to $350,000.
The lender says it can prequalify a borrower in 24 hours and that straight purchases usually fund within 60 days, with construction extending the timeline. Soft costs such as appraisals, environmental reports, construction interest and closing costs can be financed inside the 504 loan, and projected income is considered alongside historical cash flow. Collateral is typically the building being financed.
Alongside lending, CDC advocates for small business lending policy in Congress and runs a congressional small business tour program. Its offices are in San Diego, Arlington, Pasadena, New York, Detroit and Irvine. Fees range from $3,750 to $5,000 depending on deal size, with more if documents such as a land lease need review.
Best for
Small business owners buying, building or refinancing the property they occupy who can cover a 10 percent down payment and meet SBA size limits; not a lender for investor-owned rental property.
What they do
- SBA 504 commercial real estate loans
- SBA 504 refinancing
- Small business loans from $30,000 to $350,000
- Construction and expansion financing
- Equipment financing
- Pre-loan and post-loan business advising
- Veteran business loans
Details
| Attribute | Value |
|---|---|
| Ownership | Nonprofit |
| Other offices | Arlington, VA, Pasadena, CA, New York, NY, Detroit, MI, Irvine, CA |
| How they charge | Fees range from $3,750 to $5,000 depending on deal size, with more if documents such as a land lease need review; 504 rates are published monthly. |
What stands out
- SBA 504 financing from $250,000 to $30 million or more
- Publishes the SBA 504 rate for each monthly funding cycle, with a rate history going back years
- States it can prequalify a borrower in 24 hours
- Offices in San Diego, Arlington, Pasadena, New York, Detroit and Irvine
- Part of the Momentus Capital family of organizations
Common questions
- How is an SBA 504 loan structured?
- A bank or other lender provides 50 percent of the total purchase, CDC provides 40 percent as a fixed-rate second trust deed and the business owner contributes a 10 percent down payment. On a $500,000 building that means a $250,000 bank first mortgage, a $200,000 CDC second and a $50,000 down payment.
- How long does an SBA 504 loan take to fund?
- Straight purchases usually require no more than 60 days to fund. If construction is involved, the process takes longer.
- Are there prepayment penalties on an SBA 504 loan?
- Yes. There is a declining prepayment penalty for the first ten years of the loan, based on the loan amount and the funding rate.
- What is the maximum SBA 504 loan?
- A 504 loan can finance up to 40 percent of total project cost, or $5 million, and up to $5.5 million for manufacturing businesses. The business's tangible net worth must be under $15 million and after-tax net profit must average $5 million or less over the prior two years.
- What fees are involved?
- Fees vary by deal size and range from $3,750 to $5,000. Additional fees may apply if specific documents, such as a land lease, have to be reviewed. Soft costs including appraisals, environmental reports, construction interest and closing costs can be financed within the 504 loan.