| Does your small business need financing?
Consider a Fixed-Asset Financing 504 Loan Program from The Worcester Business Development Corporation and The United States Small Business Administration.
WHAT IS A 504 LOAN?
Growing businesses have big plans, big ideas and big needs. Often, a growing business is unable to obtain traditional financing because of the standard requirement for a down payment of 30 percent or more. When a conventional loan is not the right alternative, a 504 loan is often the answer. The WBDC/SBA 504 Loan Program gives small business owners access to the same low-cost, fixed-rate, long-term financing large businesses enjoy through bond markets. Other borrower advantages include:
· A lower down payment—usually 10%
· Competitive, fixed-rate financing eliminates interest rate increases and lowers monthly payments.
· A longer repayment term of up to 20 years enables loan payments to be satisfied by current cash flow generated by the asset, thereby freeing up working capital for other uses.
ELIGIBILITY GUIDELINES
To be eligible, a business must be a for-profit corporation, limited liability company, partnership or proprietorship with a net worth of $7 million or less. Average net profits after taxes cannot exceed $2.5 million per year for the previous two years. Public purpose must be demonstrated through job creation or other community benefit.
Loan proceeds may be used for:
· Purchasing land and/or existing buildings
· Constructing, modernizing, renovating or converting owner-occupied facilities
· Purchasing machinery and equipment to be used for 10 years or more
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