WASHINGTON – Aug. 10, 2011 – The 20-year interest rate on U.S. Small Business Administration (SBA) “504” commercial real estate loans fell in August to its lowest level of 2011.
For small business owners seeking to purchase or enhance commercial property, the current 20-year rate is 5.13 percent – the fifth lowest in program history, with the lowest on record set in October 2010 at 4.52 percent.
The current 10-year interest rate for industrial machinery and equipment loans is 4.50 percent. Both the 20- and 10-year 504 interest rates are fixed for the term of the loan and in some cases only a 10 percent down payment.
The SBA’s 504 loans are paired with private-sector commercial loans and provide up to $5 million of small business financing for standard projects and up to $5.5 million for green initiative and small manufacturer projects The maximums apply to SBA loan portions only – there is no limit on the private lenders’ portion.
The 504 loans may be used to buy fixed assets, including the construction, expansion or renovation of commercial property; industrial machinery and equipment; or other fixed assets with a useful life span of at least 10 years.
“Strong, healthy small businesses may not find a more opportune time than now to invest in and expand for their future, given the emerging opportunities in the commercial real estate market and low 504 interest rates,” says Todd Kocourek, president & CEO of Florida First Capital Finance Corporation, which is based in Tallahassee, Fla.
To find out more about SBA loans, visit their website, www.sba.gov
© 2011 Florida Realtors®