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504 Loan Structure

Through the 504 loan program, CMDC provides up to 40% of the eligible project costs. The borrower provides an equity injection of 10% to 20% and a private lender provides up to 50% of the project costs.

Use of Funds     Source of Funds
  Land $100,000      Bank $500,000 50%
  Building $800,000      CMDC/504 $400,000 40%
  Soft Costs $100,000      Equity $100,000 10%
  Total $1,000,000      Total $1,000,000 100%


  • CMDC does not provide interim financing. CMDC provides permanent take-out financing when the project is completed and the loan is closed in accordance with SBA/CMDC loan covenants and restrictions. 
  • $5 million is the maximum amount that CMDC/SBA will loan or guarantee for most projects. 
  • The minimum 504 project amount is $125,000.  For projects smaller than $125,000, please see the SBA 7(a) Loan Program.   
  • The rate on the 504 loan is set when the loan is funded.  This typically occurs 90 to 120 days after the completion of construction or the purchase real estate, machinery, etc. The rate is then fixed for the term of the loan.