Fees associated with an SBA 504 loan are added to the loan amount allowing you to amortize their cost over the term of the loan. The fees are based on 40% of the project cost. The table below illustrates the typical fee structure associated with a $1 million project and a $400,000 net debenture.

SBA Guarantee Fee (Currently 0%) SBA $2,000
Funding Fee (0.25%) SBA CSA $1,000
CDC Processing Fee (1.5%) CMDC $6,000
Closing Costs ($2,500) CMDC/Attorney $2,500
Underwriters Fee* Underwriter $1,648
  TOTAL $411,148
Rounded to the next highest thousand (refunded to Borrower) $852


*The Underwriters fee is a function of the gross debenture amount and is calculated in the following manner. Subtotal of SBA fees as listed above, plus net debenture amount; this summation is divided by 0.996; round this number up to the next highest thousand; multiply number by 0.004.

Servicing Fees

When your loan closes your monthly payment will include servicing fees based on the declining balance of the SBA 504 loan. Servicing fees are reduced at five-year intervals based on the loan balance at each interval.

Prepayment Premiums

SBA 504 loans are subject to a prepayment premium. The premiums decline over the life of the loan and are eliminated entirely half way through the loan term. See a CMDC loan officer for more information.

Lender Participation Fee

The 504 Program requires the First Mortgage Lender to pay a lender participation fee. The fee is charged by SBA to provide compensation for the senior lender's lien advantage in the event of a foreclosure. It is a one time fee equal to one-half of one percent (0.5%) of the principal amount of the first mortgage.

Other Miscellaneous Closing Costs

Borrower is responsible for all closing costs associated with the SBA closing, including, but not limited to, recording fees, title company closing fee, title insurance (reissue) and borrower attorney's opinion letter.