You took out an SBA 504 small business loan from an SBA lender in North Carolina because you knew it was a smart financial decision. With only 10 percent down and a competitive, fixed interest rate, you have been able to make predictable payments and have more cash available for things like staffing, inventory, etc.
Perhaps you have been so successful due to your SBA 504 small business loan that you are ready to expand. Maybe you want to purchase new equipment or even open a new location. These are great goals, but they also require additional funds.
You may be wondering — can I take out multiple SBA 504 loans?
The short answer is, yes. Let’s take a look at the particulars of applying for an additional SBA 504 loan.
Requirements for an Additional SBA 504 Small Business Loan
As long as the amount you want to borrow does not exceed the $5 million limit for total funding for SBA 504 small business loans, you can apply for an additional loan. So you will want to consider how much you have already borrowed and how much more you need.
That will allow you to determine if another 504 loan will make sense for your expanding business. If it does, there are a few things that will help your chances of getting approved a second time:
- A great credit score.
- Enough collateral to cover the payments on your current SBA loan and the new loan.
- A record of on-time payments for the SBA loan you already have.
If you are interested in another SBA 504 loan but you have already borrowed more than 5 million, there is one more option. Consider if you qualify for the SBA Green Energy Program. To meet the requirements, you must build or buy a building that is 10 percent more energy efficient than your current building.
Or you can offset 10 percent of your energy use with renewable and more earth-friendly power sources such as wind, solar or geothermal energy.
If approved through the SBA Green Energy Program, a borrower can take out up to $5.5 million per project as opposed to $5 million total.
Benefits of a Second SBA 504 Small Business Loan
Securing an additional loan with great terms like those offered by the 504 loan program can be a smart way to grow your business. With small business financing in Virginia, you will be able to hire more employees, expand your inventory with new products, or purchase new equipment.
If your business is already a success, and you are adding customers or clients, don’t hesitate to see how far you can take your accomplishments. Making smart decisions now about expansion and growth will ensure your business reaches its full potential.
504 Capital Corporation is here to help. If you are ready to apply for your SBA 504 small business loan, give us a call on 919-645-5735. We are one of the leading SBA lenders in North Carolina. We can talk you through the options and get you matched with the best lender for your needs today.