A Little Background on the SBA 504 Loan Program . . .

Small businesses have long been recognized as the backbone of the American economy.

Small business owners are the movers and shakers in America - the people with the ideas, energy and drive to build and run a business.  Small businesses are also where new jobs are being added to the economy as companies grow and hire more staff. 

To support small businesses and to strengthen the economy Congress created the U.S. Small Business Administration (SBA) in 1953 to provide a range of services to small businesses including financing.  In 1958 Congress passed the Small Business Investment Act which established what is known today as the Certified Development Company Economic Development Loan Program or the SBA 504 loan. 

The SBA 504 loan is designed to assist entrepreneurs obtain long-term financing for capital assets like the purchase of real estate and expensive equipment.  Recognizing that small business owners sometimes have more difficulty getting traditional business financing but need funds to grow, the SBA 504 loan provides financing for entrepreneurs  to make the investment in their own facilities, continue to expand and create new jobs.   Small business owners can buy their own building or build a larger facility to accommodate increased sales and more staff.   Owning a building also gives a small business owner more of a stake in the community and builds equity   The community gets the benefit of additional jobs, business growth and tax revenues from a growing small business.   

(Photo Right) Ryan Brothers Coffee in San Diego, CA.  The photo features owner Tom Ryan (left) with Tim West, Vice President, Wells Fargo Bank who provided the first mortgage for the project.  The SBA 504 loan was provided by CDC Small Business Finance Corp. San Diego, CA.

The results are a win-win for both the small business owner and for the community!