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SBA 504 Loan (Debenture) Program

For more information or to apply for an SBA 504 Loan, contact Mid-America Certified Development Company Director Jitka Durman.

  • Debenture secured by 2nd mortgage
  • First mortgage lender amount unlimited
  • Change in ownership transactions are eligible

Equity Requirements

Business must pay 10% to 20% of project costs

  • If business over 2 years old and general purpose real estate: 10%
  • If business over 2 years old and special purpose* real estate: 15%
  • If business less than 2 years old and general purpose* real estate: 15%
  • If business less than 2 years old and special purpose real estate: 20%
  • * as defined by SBA

Use of Proceeds

  • Purchase major fixed assets such as land, buildings, improvements, long term equipment, construction and renovation
  • Soft costs such as architect and engineering fees, interim interest, environmental studies, equipment setup and delivery, and certain legal fees related to the loan
  • NOT ELIGIBLE: General working capital, accounts receivable, inventory, debt refinancing, franchise fees and vehicles


Interest Rates

  • Generally slightly above long-term Treasury Rate
  • Based on current market at time of funding for 5- and 10-year Treasury Issues plus an increment above the Treasury Rate
  • The debenture rate for June 2016 is 4.232%.



  • For-profit business
  • Tangible net worth not in excess of $15,000,000 and average after tax net profit cannot exceed $5,000,000 for the previous two years
  • Job creation or retention requirement: One full-time equivalent job created or retained for each $65,000 of Debenture amount unless a small manufacturer, then 1 job per $100,000

Fees Relating to Debenture

  • Approximately 3% of the debenture amount and financed with the debenture
  • Funded with debenture proceeds



  • 10 years on equipment
  • 20 years on real estate