November SBA 504 Rates

The Small Business Administration (SBA) has released new regulations through SOP 50 10 7.1, effective November 15, 2024, aimed at expanding access to the SBA 504 Refinance Program. Here are the key updates:

Key Program Updates:

• Increased Loan-to-Value: Maximum loan-to-value ratio raised from 85% to 90% for refinancing without expansion, including cash out for Eligible Business Expenses (EBE).
• Elimination of EBE Cap: The previous 20% cap on EBEs has been removed, offering more flexibility.
• Relaxed Government Debt Refinancing: Savings on proposed payments now qualify as sufficient to meet the 10% substantial benefit test for refinancing government debt.
• Expanded Eligibility: “Other secured debt” now qualifies as an EBE in debt refinancing without expansion.
• Reduced Eligibility Criteria: Only 75% of the original loan needs to have been used for Eligible Fixed Assets in both 504 refinancing programs (previously 85%).

These changes aim to make SBA 504 refinancing more accessible and simplify the application process for small businesses. Please stay tuned for further updates as the SBA finalizes implementation guidance. Contact us for more details on how these changes could benefit your business.