Is it time to renew the lease on your small business property? Before committing to months and months of additional rent payments, consider making a much wiser financial decision. Buying—or building—a property for your business means investing in your future and comes with many benefits.
If you worry that your company can’t afford to own a commercial space, think again. Resources like the SBA 504 loan can help you secure a low interest rate, long-term financing and little money down. Ready to learn more?
First, let’s take a look at some of the biggest advantages of property ownership.
Better Small Business Planning
Owning a building means investing in your future. Because loans like the SBA 504 loan can lock in your monthly mortgage payment at a long-term fixed rate, you no longer need to plan for potential unexpected rent increases when budgeting for your company and its bottom line.
Ownership also means having equity, which is always a smart move. Every payment you make gets you one step closer to paying off your loan instead of using your earnings for continual rent payments that never end. Investing in commercial real estate puts you in a much more optimal position with more choices when it comes time for retirement. Your property will likely appreciate over many years, helping you make a nice profit.
Small Business Savings
Property ownership also allows you to lower your taxable income with depreciation deductions. Interest on commercial real estate loans is also tax deductible.
Of course, tax benefits—plus lower, reliable payments—leaves room in your business budget to invest in other resources to improve your company like additional employees, improved products, etc.
Creative Control Over Your Space
Being in charge of your own space allows you to design and manage it however you would like. Feel free to customize your floor plan to suit your needs. You can make improvements whenever you feel you need them and generally have much more control over your facility.
Without the limits of landlords, ownership allows for your OWN ideas, no matter what they may be.
How An SBA 504 Loan Can Make You a Property Owner
If this all sounds wonderful, yet impossible, you probably haven’t researched an SBA 504 loan option. This attractive loan can make a borrower’s dream come true. Small business lenders work with Certified Development Companies to offer funds for building new facilities or purchasing existing buildings. Advantages include:
- Generous term lengths.
- Lower interest rates than business loans funded by traditional financial institutions.
- Financing for up to 80 to 90 percent of project costs.
- Minimal down payments. In most cases, the borrower is required to invest only 10 percent of the total project cost, which includes renovations and soft costs. This allows the business to preserve cash for working capital.
With interest rates at all-time lows, now is the time to consider an SBA 504 loan. To talk to an expert about using the loan to build or buy a property, call 504 Capital Corporation at 757-623-2691, or learn more about the borrower benefits at https://504capital.com/borrowers.