Here is a quick check to see if your project will be eligible for the 504 Debt Refinance Program. There could be other factors that would make it ineligible but generally these are the key areas to determine eligibility.
As always feel free to contact us and talk through your project.
To be eligible for the 504 Debt Refinance program, all of the answers to the following must by “Yes”.
- Was the debt to be refinanced for owner occupied (at least 51%) commercial real estate and/or fixed assets equipment?
- Is the debt at least 2 years old?
- Have monthly payments on the debt been current the past 12 months?
- Has the borrower been in operation the entire two year period?
- No portion of the debt to be refinanced is part of a government loan e.g. 7a, 504, USDA?
- The borrower(s) have never defaulted on a government loan
- The personal liquidity of any individual owner (20% or more) does not exceed the debt to be refinanced (liquidity = cash + cash equivalent + marketable securities + retirement funds if individual is over age 59 1/2)