Partners - Granite State Development Corporation

SBA 504 Quick Fact Sheet

Rate History

Lender Forms

Rate Pricing and Funding Dates

What are the benefits of working with GSDC?

GSDC has over 40 years of experience providing SBA 504 financing. Since inception we have approved over 5,000 SBA 504 loans providing over $2.4 billion in financing to fund small businesses in New England. We work with 100’s of lenders located throughout New England.
Our lending & underwriting team are among the most experienced active in the industry today. GSDC’s team of lenders and underwriters will work efficiently to ensure the quickest possible response time to your customer’s loan request.
GSDC is one of the few 504 lenders in the industry that can approve 504 loans through the SBA Premier Certified Lender Program (PCLP). All 504 loans processed PCLP can expect a decision within 48 hours of receipt of a complete underwriting package. If the loan is approved by GSDC, SBA will provide a loan number when requested and GSDC will issue a term sheet to your borrower. (There is no SBA involvement in the approval process).
GSDC will also process loans to SBA through ALP Express (504 debentures less than $500M) and via regular ALP submission. Non PCLP loans will require SBA approval. Once GSDC has a complete package our underwriters will send the credit file to SBA for a decision within 3-5 days. SBA’s goal is to process ALP express loans within 48 hours and ALP loans within 3-5 days.

What are SBA's requirements regarding the Loan terms from the Participating Lenders?
- The Lender Loan must have a term of at least 7 years when the 504 loan is for a term of 10 years and at least 10 years when the 504 loan is for 20 years.
- Interest rates must be reasonable.
- The Lender Loan must not have any early call feature or contain any demand provisions unless the loan is in default.
What are the general rules to determine if a Project Financing Structure qualifies for an SBA 504 loan?
- The Lender financing must be equal to or greater than the debenture.
- The net debenture may not exceed 40% of the project’s total cost.
- The borrower’s injection must be at least 10% of the total project cost. An additional 5% is required for a new business (new is defined by SBA as less than two years of operating experience) and 5% for special purpose properties.
- A 20% cash injection is required if the project involves both a new business and a special purpose property, and when it is the borrower’s second 504 loan for a special purpose property.
- No more than 50% of the project costs can come either directly or indirectly from Federal sources.
What type of property is classified as Special Purpose? And therefore require an additional 5% equity contribution.

The SBA classifies the following types of properties as Special Purpose:

Dormitories; Cold storage facilities where more than 50% of total square footage is equipped for refrigeration; Tennis clubs; Golf courses; Swimming pools; Amusement parks; Sports arenas; Bowling alleys; Theaters; Marinas; Gas Stations; Service centers with pits and in-ground lifts; Car wash properties; Hospitals; Surgery centers; Urgent care centers; Nursing homes; Assisted living facilities; Funeral homes with crematoriums; Cemeteries; Sanitary landfills; Museums; Clubhouses; Hotels and motels; Wineries; Railroads; Farms (including dairy facilities); Oil wells; Mines; Quarries; and Gravel pits.
Does the SBA 504 Program finance investment properties?

No, the program is designed for owner-occupied facilities.
Does the business have to occupy the entire building?

The applicant must occupy 51% of an existing building and 60% of a newly constructed building. The remaining space may be leased to a third party. No proceeds of the 504 financing can be used for fitup of the leased space.