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NADCO Lender Affiliate Membership ($595 Annually)

*NOTE: All memberships are from October 1 to September 30 the following year. 


Lender Affiliate membership is open to financial institutions providing first mortgage financing for 504 projects. As a valued NADCO member, you will receive industry-specific information as soon as we get it.

And we don’t just forward SBA regulations and legislation. We provide in-depth analysis of all issues along with explanations of what program changes mean to the industry.


Benefits of Lender Affiliate Membership Include the following:

  • Broadcast email delivery of urgent regulatory and legislative updates, technical issue notices and important membership information.
  • Listing on our website membership directory
  • Substantial discounts on NADCO’s professional 504 training programs and meeting registrations
  • Access to the "Members Only” section of the NADCO website

Members find a wealth of information on our website including sample forms used for SBA 504 loans, detailed information on technical issues, and legislative updates on the SBA 504 program.

NADCO’s programs, products and activities are supported by CDCs and other organizations that pay annual dues.


If you are interested in becoming a member, please complete and submit the Affiliate Membership application.

To inquire about annual dues for Lender Affiliates members please email Our fiscal year runs from October 1 to September 30.


Click here to download a Banking Partner White Paper.

Why partner?

Mitigation of Credit Risk. Lenders have first lien position and typically a 50% loan-to-value ratio, minimizing collateral risk. In most cases, the SBA can realize on its collateral only if the lender is paid in full.

Management of Overall Lending Limits and Industry Exposure. With 504, smaller banks can entertain larger projects. Larger banks can limit their exposure to certain industries and/or to a particular borrower. The reduction of CRE loan concentration on your balance sheet reduces regulatory concerns.

Assist More Customers. Leverages lending capacity across more borrowers and diversifies default risk and reduces loss in the event of default.

Gain New Customers. SBA 504 loans are designed to finance growth companies, and a business owner who is investing in a permanent facility is often entering into his largest business-related loan. An SBA 504 loan often becomes the basis of an entire banking relationship.

Active Secondary Market. There is an active secondary market for 504 first mortgage loans again, so banks can reduce their exposure to nearly zero and enhance their non-interest income while retaining the customer’s primary banking relationship.
Strengthening of Core Earnings. Pricing of the bank’s loan is at its discretion. 90% financing also means that more of the customer’s funds remain on deposit. The bank is able to earn fees and interest on the interim loan, and generate fee income from sale premiums and loan fees if it chooses to sell the first mortgage loan in the secondary market.

CRA Credit. Banks that participate in SBA 504 loans are eligible for Community Reinvestment Act (CRA) credit on certain projects.



Getting Started

Start with a 504 Loan prospect. The rest is easy.

Locate your nearest CDC by pointing your browser to Membership > Find a Member > Certified Development Companies in the upper navigation menu. Contact a CDC and speak to a loan officer to discuss how you can partner with the CDC to offer SBA 504 loans to your customers.

You will have one more solution for your growing business customers who need financing.

If you have an on-going relationship with the borrower and the project makes sense but there are lending limits to consider, or perhaps a credit enhancement is required to get your loan past the committee, or the customer only wants to pledge the asset being financed, then consider the SBA 504 loan. When you need to manage liquidity, SBA 504 loans allow the bank to advance only 50% of a project cost – and even this 50% can be liquid it needed – providing excellent flexibility for managing your balance sheet.

SBA 504 loans finance up to 40% of eligible project costs and the participating bank provides a first mortgage loan that is typically for 50% of the project and has first lien position on the asset being financed.

The bank loan has a minimum 10-year term on real estate or a 7-year term on machinery and equipment, but you set the interest rate and fees and you establish the covenants. The bank also provides the interim financing or a bridge loan for the construction phase of the project.


When construction is complete, a Certified Development Company (CDC), working with the U.S. Small Business Administration (SBA), then provides financing with an SBA-guaranteed second mortgage that takes a second lien position, pays off the interim loan and provides permanent financing for 10 or 20 years at a competitive, fixed interest rate.

You get a 50% loan to value ratio and you were able to make a loan to a business customer that might not have worked with conventional financing. Additionally, the business borrower gets to retain more working capital and continue to grow the business.

It’s good business practice to present your small business customers with all options when they are planning to purchase commercial real estate. Even if they qualify for a conventional solution, the prudence of preserving their liquidity combined with the security of the low, fixed rate on the second lien, often makes the SBA 504 loan the better choice. Your customer will appreciate the great customer service in creating a tailored financing option that makes their project possible! And there is always the prospect of losing customers to lenders who present the SBA 504 option.




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