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Debt Refinance

On December 16, Congress released the text of the omnibus bill which will fund the government for the remainder of FY16. It contains a provision which will permanently reinstitute the debt refinancing program.


This is a result of many hours of work by NADCO and its members, our congressional allies, and SBA, and a major victory for the CDC industry. NADCO has worked tirelessly to promote debt refi legislation and advance it through any and all available avenues. It is truly gratifying to see this result come from such extensive effort.

Congress has added a few additional caveats on debt refi in exchange for its return. The program can only be used in years that both standard 504 and the refi program are at zero subsidy. Additionally, a CDC's 504 portfolio, by dollars, must be at least 50% standard 504 loans. Refi loans cannot make up a majority of the portfolio. A waiver provision exists if SBA sees good cause for additional refi loans to be made.

While it is exciting to be included in the omnibus, this is not yet law. This bill still needs to pass through Congress and be signed by the President. We anticipate those votes will happen by the end of this week or early next week and are hopeful for their success. Please remember that if this does occur, SBA has said it will take AT LEAST 4-6 months to be able to restart this new version of the refinance program. NADCO will send a second message once the final congressional vote has occurred to report whether debt refi has been reinstituted

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