SBA 504 loans offer long-term financing for owner-occupied real estate and major equipment. Learn how they work and pre-qualify with Flexcap Solutions.
Flexcap Solutions is a Miami-based commercial finance brokerage that has funded more than $100 million for U.S. businesses through a network of 100+ lender partners.
An SBA 504 loan is long-term financing for major fixed assets, mainly owner-occupied commercial real estate and long-life equipment. It is provided through a Certified Development Company working with a senior lender. Flexcap Solutions arranges 504 loans and helps owners decide whether the program fits.
A 504 loan is designed for established, operating businesses making a long-term investment in their own facilities or equipment. It can be a good fit if you want to:
Unlike a 7(a) loan, a 504 project usually has more than one source of money. A common structure looks like this:
The maximum applies to the SBA/CDC debenture portion, not the total project: $5 million in most cases, and $5.5 million for manufacturers and qualifying energy projects. Repayment terms are 10, 20 or 25 years. The rate is fixed, based on a spread over the 10-year U.S. Treasury rate at the time the debenture is sold, and fees of about 3% of the debt may be financed with the loan.
The 504 program is built for fixed assets, so some uses are not allowed:
If you need working capital, look at SBA 7(a) loans, a business line of credit or a term loan. For investment property, see our real estate investor loans.
To qualify, a business generally needs to:
Each CDC and lender will also have its own review. Expect to provide business and personal financial records, details of the property or equipment, and a project budget. Our guide to business funding requirements explains how to prepare.
Comparing SBA programs? See our guide to SBA 7(a) vs. SBA 504 loans.
An SBA 504 loan can be used to buy, build or renovate buildings or land, and to purchase long-term machinery and equipment. It can also refinance qualified debt. It cannot be used for working capital, inventory, or speculation or investment in rental real estate.
A Certified Development Company (CDC) is an SBA-approved organization that provides the 504 loan, working with a senior lender. SBA 504 loans are available only through CDCs.
A 504 loan is focused on major fixed assets such as real estate and long-term equipment, while a 7(a) loan is more flexible and can also cover working capital. A 7(a) loan is made by one lender, while a 504 project usually pairs a senior lender with a CDC.
SBA 504 loans have maturities of 10, 20 or 25 years. The right term depends on the asset being financed.
No. The 504 program does not allow speculation or investment in rental real estate. Real estate investors can look at DSCR and other real estate investor loans instead.
No. Pre-qualifying with Flexcap Solutions does not affect your credit score.
Planning to buy, build or equip your own facility? Pre-qualify online with no impact to your credit score, and a Flexcap advisor will help you weigh a 504 loan against your other options.
Last updated: November 2026
