An SBA 504 loan provides long-term, below-market fixed-rate financing for owner-occupied commercial real estate with as little as 10% down. It pairs a 50% conventional first-lien loan with a 40% SBA-guaranteed debenture, leaving the borrower to contribute only 10% — preserving working capital while locking in 10, 20, or 25-year fixed rates.
What is a SBA 504?
SBA 504 loans provide long-term, below-market fixed-rate financing for owner-occupied commercial real estate and major equipment. Backed by the U.S. Small Business Administration, they pair an SBA debenture (typically 40% of project cost) with a conventional first lien loan (50%), leaving the borrower to contribute as little as 10% down.
ASB Capital Loan Funding helps business owners acquire, construct, or expand owner-occupied facilities using SBA 504 financing — preserving working capital while locking in long-term, predictable payments.
Program Highlights
- As low as 10% down payment
- Below-market, long-term fixed rates
- Loan amounts up to $5.5 million
- 10, 20, and 25-year terms
- Owner-occupied commercial real estate
- Fixed-rate stability for decades
Who This Loan Is For
- •Business owners buying their own facility
- •Companies expanding or constructing owner-occupied space
- •Owners wanting to preserve working capital
- •Borrowers seeking long-term fixed rates
Typical Requirements
- •Business must occupy 51%+ of the property (existing) or 60%+ (new construction)
- •For-profit operating business in the U.S.
- •Tangible net worth under $20 million and avg net income under $5 million
- •Business size meets SBA standards
- •Personal guarantee from principals (20%+ ownership)
- •Demonstrated ability to repay from business operations
Key Terms to Know
- SBA 504 Loan
- A government-backed commercial loan pairing an SBA debenture (40%) with a conventional loan (50%) and 10% borrower equity for owner-occupied real estate.
- Debenture
- The SBA-guaranteed, fixed-rate bond that funds the 40% portion of a 504 loan at below-market rates.
- Owner-Occupied
- A property in which the operating business occupies a required minimum percentage of the space — the core eligibility rule for SBA 504.
See our FAQ and loan resources for more definitions and checklists.