Federal Programs

Small Business Administration (SBA) 504 Loan Program


The SBA 504 Loan Program is a long-term, fixed-rate direct loan to be used only for fixed-assets (purchase of land or buildings, leasehold improvements, machinery and equipment with a useful life of over 10 years). It cannot be used for working capital. Financial institutions provide 50% of the total project costs. SBA loan proceeds may not exceed 40% of the total project costs. Minimum equity requirement is 10% and the minimum loan amount is $500,000; the maximum is $1.3M. There is a job requirement of an average of 1 job per $35,000 of SBA 504 Loan.

Small Business Administration (SBA) 7(a) Loan Guarantee Program


The SBA 7(a) Loan Guarantee Program helps finance long-term loans through reduced-risk by providing up to 85% guarantee of the bank loan to the lender. Equity requirement is 10% - 30% and the maximum loan amount is $2M. Maximum guarantee amount varies between $500,000 and $1M and is based on the useful life of the asset.

Rural Business Development Program


The Rural Business Development Program is funded by the U.S. Department of Agriculture, Rural Business Cooperative Service. The program is a guarantee of bank loan for working capital fixed assets or equipment for “risky” projects. The purpose of the program is to create and maintain employment and improve the economy in non-urban communities with a population of less than 50,000.

Intermediary Relending Program


The Intermediary Relending Program is locally based small loan programs targeted towards communities of less than 25,000 population. The fund is primarily for financing fixed-assets. The equity requirement is 10%. The Rural Business Cooperative Service lends to local intermediaries that in turn lend to development projects.