Skip to content


Historic Low: SBA 504 Loan Program’s 20-Year Fixed Rate Dips Below 4% for Borrowers for First Time Ever

According to the National Association of Development Companies (NADCO), “Borrowers of SBA 504 loans this month will be in the first class of small business borrowers with 504 financing fixed at a rate below 4% in the program’s history.”

As announced in Seedcopa’s monthly #RateTracker e-blast, which shares new loan rates as soon as they’re released, the SBA 504 loan’s 20-year effective rate for June is 3.98%, edging below the 4.01%  record set in December 2012. “This is the first time a 20-year 504 effective rate calculation has been this low**,” says NADCO.

“Another standout metric is the 504 rate when compared to the current prime rate,” NADCO continues in a press release. “At 152 basis points under the Bank Prime Rate, the June funding is the furthest below prime that 20-year rates have been since May 2007. Even if the Federal Reserve makes the two ¼-point policy rate cuts anticipated by the market this year, the 504 effective rate may remain approximately one full point below prime (not including any additional spread over prime charged by many commercial real estate lenders).”

**Based on the current fiscal year borrower fee.

Key Features of the SBA 504 Loan Program

  • -Used for owner-occupied commercial land, property, construction or equipment with total project costs from approximately $100,000 to approximately $15,000,000.
  • -Facilitated by SBA-certified development companies like Seedcopa + SeedcoDE.
  • -Typically, small business borrowers make a 10% equity injection, a bank or credit union finances another portion of the project cost, and a CDC, through the SBA,  finances another portion of the project cost guaranteed by the federal government.
  • -10, 20 and 25-year fixed rate options

For more information on how to attain an SBA 504 loan, e-mail or call 610-321-8241.

To be among the first to receive new loan rates monthly, sign up for our #RateTracker e-blast by emailing

Also visit our SBA 504 Guide at

Back To Top