Never Fear Rent Hikes Again! SBA 504 Loans for Small Business Real Estate Purchases

Recent headlines confirm what small business owners already know: It’s getting harder to afford to lease commercial space. As their own costs increase, landlords across the U.S. will likewise keep raising rents, which makes it even harder for small businesses to rebound following the pandemic and inflation. If you’re a small business owner who’s dreading that next rent increase, here’s good news: You can turn this challenge into a win with a U.S. Small Business Administration (SBA) 504 loan to purchase your business’s commercial real estate.  

When you own your business’s commercial property, you gain control over your occupancy costs while creating long-term financial security for yourself and your business. Most small businesses are eligible and getting approved is easier than you think: In fact, as the country’s leading SBA 504 lender, TMC Financing has helped more than 450 small businesses get approved just this year! 

 The SBA 504 loan: Specifically developed to help small businesses 

The SBA 504 loan program was developed to meet the specific needs of small business owners who may not meet all of the approval criteria for banks and other lenders or who find it too difficult to save enough for a conventional commercial mortgage’s high-cost down-payment.  

Here are just a few of the SBA 504 loan’s benefits, compared to conventional commercial loans: 

  • Owner equity: While conventional commercial real estate mortgages require 20-30% or more of a project’s cost as a down payment, most SBA 504 loans only require 10%, which can be cash or a combination of options to help you meet the requirement.
     
  • Payment amortization: With the SBA 504 loan program, loans are amortized up to 25 years, instead of 5-10 years, which is typical for most conventional commercial real estate loans. This results in a lower monthly payment – in fact, many SBA 504 borrowers find that their loan payments are equal to or less than what they paid in monthly rent. (Try calculating your payments to see how yours could compare.)
     
  • Fixed interest rates that last the life of the loan: Most conventional commercial mortgages offer variable interest rates that can rise multiple times over the life of the loan, making payments both unpredictable and potentially more expensive over time. With the SBA 504 loan program, a competitive interest rate is fixed for the life of the loan – and if interest rates drop, you have the option to refinance your SBA 504 loan with another SBA 504 loan (as long as your loan is in good standing). That means that you gain the same great SBA 504 program advantages, along with a lower rate. 

Real-life success stories 

With the SBA 504 loan program, the goal is to enable more small businesses to own their commercial real estate by offering more flexible eligibility and approval criteria than conventional mortgages, along with advantageous terms that enable you to control your occupancy costs, reinvest in your success and create long-term financial security, too.  

Here’s how entrepreneurs like you have used the SBA 504 loan program to purchase their commercial real estate, upgrade equipment and more: 

 Speak with an expert to learn more about the SBA 504 program  

If your business is located within our service area of California, Arizona, Nevada, and Oregon, contact TMC Financing today to find out more or to get started with the SBA 504 loan program. And if your business is located outside of our service area, try the SBA’s Lender Match tool to find a qualified certified development company (CDC) lending partner near you. 

There’s no obligation and like many business owners before you, you’ll be pleasantly surprised to learn that you can own your commercial real estate more easily and affordably than you think – and you’ll never have to fear another rent increase! 

About TMC Financing 

Founded in 1981, TMC Financing is the leading provider of SBA 504 commercial real estate loans in the nation, funding projects worth over $10 billion across Arizona, California, Nevada, and Oregon. Over 6,000 businesses have benefited from this financing, resulting in the creation of an estimated 60,000 jobs. Learn more.