What is a 504 loan?
This is a loan program that is sponsored by the U. S. Small Business Administration and administered by organizations known as Certified Development Companies (CDC).

In cooperation with a participating bank known as a ‘third party lender’ the combined loans of the SBA and bank are used to finance the fixed assets of a small business at better terms and conditions than that business may have received from conventional bank financing.

What is the advantage of obtaining a 504 loan?
The 504 loan program lets you make a low down payment with a fully amortized loan and gives you a fixed interest rate. In most instances your down payment will be as low as 10% with an interest rate lower than most conventional lenders.

What can be financed under 504?
The 504 loan will finance the fixed assets of a business. Traditionally, fixed assets are commercial real estate property or equipment that has an economic life of 10 year or longer.

What does a 504 loan cost?
All of the fees of the SBA loan are financed as part of your loan. As the borrower, your out-of-pocket costs will come from the participating lender and the costs of a title company (if the project involves real estate).

Does that mean that I have two loans?
Yes, once your loan is complete you will have to make payments to the third party lender and the Cen Cal Business Finance Group.

City of Fresno Revolving Loan Program

What is the advantage of using the City of Fresno Revolving Loan Program vs. conventional financing?
The City of Fresno Revolving Loan Program is not a substitute for conventional financing. We encourage small business owners to obtain conventional financing when possible.

If you have a business that is located in Fresno’s Empowerment or Enterprise Zones the City of Fresno’s Revolving Loan Program will give you special consideration and assistance in the financing of real estate, working capital and equipment purchases. Loans are offered with a fixed rate of interest and with extended maturities.

What is a third party lender and how will I find one?
A third party lender is a bank or a lending institution. Cen Cal works with many banks and non-bank lenders and will help you locate the one that best suits the financing of your business.

Does that mean that I have two loans?
Yes, once your loan is complete you will have to make payments to the third party lender and the Cen Cal Business Finance Group.

Who do I apply to first?
You should make application to the Cen Cal Business Finance Group first. We will determine your eligibility to borrow under this program, help with any additional paperwork needed and if approved will locate a participating third party lender if you do not have one.

What will this loan cost me?
There is no cost to making an application. Upon approval and the funding of your loan, you will be charged 1.5% of the loan amount plus $500 for processing. These fees can be financed as part of your loan.
You will also be charged a loan fee, which can vary, by the third party lender. Each third party lender has different fees. You will also be charged for any extraordinary costs such as appraisals and filing documents like a deed of trust.

Are there any other conditions that must be met?
Yes. In addition to being located in Fresno Empowerment or Enterprise Zones, you should be able to predict the number of jobs that will be created as a result of receiving this loan. While there is no penalty for not meeting the projected job creation, the prediction should be a reasonable goal.