10 Year 504 Project Structure
504 Project Name
Purchase land and/or building Bank interest rate
Furniture fixtures & equipment Bank amortization (yrs)
Construction cost Bank project percentage
Construction contingency Borrower equity percentage
Professional fees & soft cost 504 project percentage
Total project 504 note rate (FIXED)
effective 504 rate
Finance Structure
Bank loan Bank loan monthly payment
504 loan 504 loan monthly payment
Total finance package Annual debt service
Required equity injection
How this 504 loan compares to Conventional financing
504 loan =
504 Conventional
Interest rate
Term in years 10
Total interest expense
*504 bond issuance fee $ -
**504 monthly servicing fees $ -
***504 bank lender fee Bank fee
***504 attorney fee $ 1,500 $ -
Total principal, interest & fees
*The bond issuance fee is added to the 504 note and amortized over the life of the loan and INCLUDED in the 504 monthly payment
**The cumulative of monthly fees paid to Wells Fargo, SBA & Premier Capital and INCLUDED in the 504 monthly payment
***Fees paid at closing
Paying off the 504 loan early
A 504 loan can be paid off at any point in the loan term. There is a prepayment premium, however, in years 1 -10:
An example of prepayment premiums for this loan would be:
in year 2 in years 6 - 10 $0
in year 4
in year 5