On Wednesday, September 16th, the Small Business Administration (SBA) 504 Loan Program completed its largest monthly funding of loans in the program’s 34-year history, including 1,462 loans for $1,284,274,000. This amount is more than double the previous record set in September 2012. Historic levels of SBA 504 loan closings and fundings were driven by unprecedented low interest rates and debt relief provided by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Additionally, small businesses continue to benefit from SBA’s April 2018 introduction of a 25-year maturity option for SBA 504 loans which complemented the program’s 10- and 20-year terms. The 25-year term provides an affordable, fixed-rate option with an attractive term that increases the SBA 504 loan program’s effectiveness by lowering monthly payments and improving borrower cash flow. This assistance is particularly critical today since countless small businesses continue to recover economically from the COVID crisis.
NADCO President and CEO Rhonda Pointon recognized this consequential achievement by highlighting the team effort of NADCO member CDCs, their lending partners, and SBA colleagues in his comment “America’s small business are vital engines of job opportunities and economic development in local communities across the country. The historic funding in September continues to validate the need and importance for community-based, mission lenders like our CDCs and for important tools like our 504 loan program in providing much needed access to capital to small businesses. Our member CDCs continue to work daily to assist small businesses and entrepreneurs as they continue on the road to economic recovery and growth.”
About the SBA 504 Loan Program and Certified Development Companies (CDCs)
The SBA 504 Loan Program is an SBA business loan program authorized under the Small Business Investment Act of 1958. The core mission of the SBA 504 Loan Program is to provide long-term financing to small businesses for the purchase or improvement of land, buildings, and major equipment, create or retain jobs, and support local economic devel