Government-Backed Support for Your Small Business Growth
At Crestico, we’re more than just a mortgage brokerage—we’re your strategic partner in unlocking SBA-backed financing tailored to your business growth and capital needs.
For many small and medium-sized businesses, SBA loans offer a powerful pathway to securing essential financing with favorable terms. Backed by the U.S. Small Business Administration (SBA), these loans are designed to help eligible businesses access capital they might not otherwise qualify for through conventional channels. At Crestico, we are experienced in navigating the SBA loan process and can help you determine if an SBA 7(a) or SBA 504 loan is the right fit for your business objectives.
The SBA doesn’t lend money directly; instead, it provides a guarantee to lenders like Crestico, which reduces our risk and enables us to offer more flexible terms and lower down payment options to qualifying businesses.
Understanding Your SBA Loan Options
While there are various SBA programs, the two most common and versatile are the 7(a) Loan Program and the 504 Loan Program.
SBA 7(a) Loan Program – The Most Versatile Option
The SBA 7(a) loan is the SBA’s primary and most popular loan program. It’s known for its flexibility and can be used for a wide range of general business purposes.
Common Uses for SBA 7(a) Loans:
- Long-term and short-term working capital
- Purchasing equipment, machinery, furniture, fixtures, supplies, or materials
- Refinancing existing business debt (under certain conditions)1
- Constructing a new building or renovating an existing facility
- Acquiring land or buildings
- Establishing a new business or assisting in the acquisition, operation, or expansion of an existing business
Key Features & Benefits of SBA 7(a) Loans:
- Loan Amounts: Up to $5 million.
- Flexible Terms: Loan terms can vary depending on the use of proceeds (e.g., up to 10 years for working capital or equipment, up to 25 years for real estate).
- Competitive Interest Rates: Rates can be fixed or variable and are subject to SBA maximums.
- Lower Down Payments: Often require lower down payments compared to conventional loans.
- Versatility: Can be used for a broad array of business needs.
SBA 504 Loan Program – For Major Fixed Asset Purchases
The SBA 504 loan program is specifically designed to provide long-term, fixed-rate financing for major fixed assets that promote business growth and job creation. These loans are structured through a partnership between a Certified Development Company (CDC) – a nonprofit entity that promotes economic development – and a lender like Crestico.
Common Uses for SBA 504 Loans:
- Purchasing land and existing buildings
- Constructing new facilities or modernizing/renovating
- existing ones
- Acquiring long-term machinery and equipment
Key Features & Benefits of SBA 504 Loans:
- Loan Structure: Typically, the project is financed with:50% from Crestico (or another private lender) covering the first mortgage.
40% from the CDC (with an SBA-guaranteed loan) covering the second mortgage.
10% (or more) from the borrower as an equity injection (down payment). (Note: Start-ups or special-purpose properties may require a higher down payment). - Long-Term Fixed Rates: The SBA/CDC portion of the loan offers a fixed interest rate for the life of the loan (typically 10, 20, or 25 years).
- Lower Down Payments: The 10% equity injection can be very attractive for businesses looking to preserve capital.
- Job Creation Focus: These loans are tied to public policy goals, often requiring job creation or retention.
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General Eligibility Criteria for SBA Loans: SBA Loans
While specific requirements vary, general eligibility for SBA loans includes:
Navigating the SBA Loan Process
The SBA loan application process can be detailed, but our team at Crestico is here to guide you every step of the way. We’ll help you:
