504 Loan	7(a) Loan
Purpose of Loan	Fixed assets such as owner occupied real estate and heavy equipment, no refinancing or working capital allowed	Any eligible business purpose
Program Goal	Job creation and retention, economic development	Access to capital not otherwise available to small business
Rates and Terms	Bank Loan: variable or fixed rate up to 25 years CDC/SBA loan: fixed rate for 10 or 20 years	Variable or fixed: term of up to 25 years depending on use of proceeds
Maximum Loan Amounts	Bank loan is nlimited; generally used for projects up to $7 million, $10 million for manufacturing	$2,000,000 with a 75% guanantee from SBA.
Fees	Bank: Application fee and construction fee, if applicable CDC/SBA fees: Upfront fees of approximately 2.75% which are typically financed in the CDC loan	Upfront guarantee fee of approximately 2.25% of the loan amount
Bank Lien	Bank has exclusive first lien	Bank holds the first lien
Loan-to-Value (LTV)	Up to 90% total - Bank loan 50 - 70%, CDC maximum of 40%	Maximum of 90%
Size Qualification	Business net worth not to exceed $7 million, average net profit for last 2 consecutive years not to exceed $2.5 million	Annual sales <$5 million or less than 500 employees depending on type of business
Prepayment Penalties	Bank - varies depending on rate and term selected CDC loan - penaltiy is one year's interest in first year then declining 1/10th each year.	Minimal prepayment in the first 3 years only. No penalty for prepayment of principal if less than 25%

Up to 90% financing with SBA loan programs

The SBA 504 Loan program provides long-term, fixed-rate financing to businesses to acquire real estate and/or plant machinery and equipment.