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Am I Eligible For A SBA Loan?

If you’re asking yourself this question, it’s possible you’ve already stumbled upon some Small Business Administration (SBA) pamphlets, or perused the SBA’s website while doing research online. Or perhaps your local bank suggested looking into an SBA 504 loan.

As an existing or soon-to-be small business owner, the SBA 504 loan appears to be a good fit, but you’re still wondering: How do I really know if I’m eligible? And being a government loan, who do I actually communicate with to get all this information?

Let’s look at some of the key eligibility factors.

My Business:

• Is looking for a loan for the construction, purchase or refinancing of commercial real estate, and/or heavy machinery.
• Is looking for a loan for the construction, purchase or refinancing of commercial real estate, and/or heavy machinery.
•  Is a for-profit operation.
• Will occupy 51% of the commercial real estate, if purchased, and/or 60% if constructed.
• Has a tangible net worth less than $15 million.
• Has an average net income for the previous two full fiscal years of $5 million or less (including affiliate businesses).
• Primarily operates in the U.S.
• Has one or more 20%-or-more owners (including the proposed property) and each are willing to guarantee the loan.
• Does not have a 20%-or-more owner presently subject to an indictment, criminal information, arraignment, or other means by which formal criminal charges are brought in any jurisdiction and are not presently on parole or probation.
• Does not have a 20%-or-more owner who defaulted on a Federal Loan and caused a loss to the Federal Government.
• Does not grow, produce, process, distribute or sell marijuana or marijuana products.

If each statement above is true, then you’re likely eligible! Here’s the other good news; Coastal Community Capital has been providing SBA 504 loans in Massachusetts since 1995 and can quickly evaluate a business’ eligibility.

We also understand that each business and its owners are unique in their own right. So while the above key factors are a quick-way to help you understand SBA 504’s eligibility, we always encourage potential borrowers to give us a call or stop by at any time to get right to the answers!

If you’re eligible and wish to seek the loan, you’ll work directly with the team at Coastal who will seek loan approval on your behalf in addition to servicing the loan after closing. The best part? It's all done LOCALLY!

About the blogger: Nick Johnas is Assistant Vice President at Coastal Community Capital. Email him at
[email protected].

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