SBA 504


The SBA 504 loan program is an economic development tool for small businesses, who create the most jobs but are excluded from access to capital markets.Economic development financing provides funds for expanding businesses that are providing benefits to themselves and their communities, such as job creation, expansion of the tax base and expansion of personal income.

SBA 504 Incentive Financing (Economic Development Financing)

  • Stimulates private sector investment in long-term fixed assets
  • Increases productivity
  • Creates new jobs
  • Increases and/or stimulate local tax base

Goals of the 504 Program

  • Create economic development opportunity in a community
  • Provide affordable long-term financing for business expansion
  • Give a financial incentive to stimulate business capital investment
  • Provide access to public capital markets for small business


Advantages of the 504 Loan for the Borrower/ Business Owner

  • Low down payment which preserves working capital
  • Fixed interest rate second mortgage loan
  • Long Term Financing
  • Rate of private sector financing usually more accessible partnering w/a 504 loan (Low Loan To Value)
  • Collateral usually limited to assets being financed

Business Owner's definitive details

Advantages of the 504 Loan for the Private Sector Lender (Banker)

  • Excellent LTV
  • US. Government as Subordinate Lender
  • No restrictions on rates as your loan is NOT guaranteed by the SBA
  • Less paperwork and "red tape" than a 7a loan
  • May participate in projects that would normally exceed lending limit or be outside policy

Bankers on financial structure, pricing, credit  criteria, collateral, CDC responsibilities,etc.

Advantages of a 504 loan for the community

  • Job creation or retain jobs
  • Capital Investment; Tax Base Increase
  • Stimulation of Other Development
  • Greater Access to Capital for "underserved" markets

See success stories on home page for more insight!

Download Provident Application Forms Here

Download Provident Business Brochure Here