SBA 504 Loans Do Not Always Require You To Create Jobs

Whoa…what?  Isn’t the 504 loan program a “Job Creation” program?

Well, actually…yes…but, like most things, there are exceptions.

Many business owners haven’t heard of the SBA 504 program, or if they have, they’ve only learned of it recently since it is one of the only viable commercial loan programs available for small and mid-sized businesses.

Whether you have heard of it or not, you may or may not know it provides the ideal way for a business in need of construction or expansion financing to go green and you do not need to satisfy any job creation requirements if you do.

(It may also be available for a non-expansion commercial mortgage refinance later this year).

By using the Green 504 loan to finance commercial property a business can sidestep the job creation public policy requirements of the 504 program and finance projects in excess of $12,000,000.

Is this cheating the system?  Well…no.

The 504 program was created at a time when we were still mostly a manufacturing economy and businesses were more people-intensive (think General Motors).  Nowadays there are many businesses that can operate with far fewer employees due to advances in technology and productivity, so it is only logical that the 504 loan now allows for this type of financing.

Ideally, the program will still create lots of jobs by enabling business owners to save money and hopefully reinvest those savings in their business – which in turn – will create more business and more jobs.  It will also help create jobs for the manufacturers of the renewable energy products that will be used by these “newly” green businesses.