Meet The Team
Board of Directors
Draymond Crawford - Former Bank Representative
Jeff Sceranka - President | Enterprise Funding Corporation
Cruz Esparza - Economic Development Manager | City of Redlands
Bob Gedeon - Senior Vice President | Citizens Business Bank
Adam Russell - Senior Managing Director | Opus Bank
Ezekiel Bonillas - Managing Director | Winslow Drake Investment Management
Chris Mata - Senior Relationship Manager | Bank of the West
Jeanne Batista - Owner | JM Batista Solutions
Russell Moore - Retired Commercial Banking Officer
504
PrograM
The SBA 504 loan is a fixed rate, low down payment, long term loan for owner occupied, for profit businesses. It is designed to preserve working capital, stabilize costs, and enhance economic development.
Financing structure of a typical $1 million project
Why is this financing special?
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Our portion of the financing can be up to $5.5 million
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As little as 10% down
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Approval within two weeks
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Secondary collateral is rarely required
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Long term fixed rates (10, 20 and 25 year terms)
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Most fees can be included in the financing which means fewer out of pocket costs
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Our loan is assumable
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We are a one stop shop
- We package the loan for free
- We make all the copies
- We find the bank
What can an SBA 504 loan be used for?
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The purchase of land, including existing buildings
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The purchase of improvements, including grading, street improvements, utilities, parking lots and landscaping
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The construction of new facilities or modernizing, renovating or converting existing facilities
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The purchase of long-term machinery and equipment
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To refinance existing debt
Eligibility
Business Type
THE BUSINESS MUST BE FOR PROFIT
Eligible business types include:
Hotels/Motels
Office Suites
Retail Operations
Manufacturing Operations
Service Operations
Wholesale Operations
Trailer Parks (R.V. Parks)
Campgrounds
Self Storage Facilities
Residential Care Facilities (such as
nursing homes)
Equipment Rental Businesses
Marinas
Equestrian Centers
Independent Contractor Agents of
Insurance Companies
SIZE
For existing businesses, the business must have an average net profit after taxes of less than $5 million per year over the past two years. $6.25 million if the business is in a labor surplus area
Occupancy
For purchase or renovation of existing buildings the business must occupy at least 51%
For new construction and occupancy the business must immediately occupy 60% of the new building
Guaranty
Personal guarantees are required for anyone who owns 20% or more of the operating company
Contact us today and we will help you determine whether your business is eligible
504 vs 7a
504 Loan
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An SBA 504 loan is for real estate, tenant improvements, and equipment. It cannot finance inventory, working capital, or accounts receivable.
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The term on a 504 is for ten, twenty or twenty five years with a fixed interest rate for both periods for the term of the loan.
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The interest rate for the 504 loan is tied to the ten or five year Treasury Bill. It is usually below conventional interest rates.
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The 504 loan is a partnership with a third party lender such as a bank. It is structured as 50% bank, 40% EFC, 10% borrower, unless it is a new business or special purpose buildings where the down payment is increased by 5% for each.
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The 504 loan uses the collateral being financed and typically does not use the home of the borrower or other assets.
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There is no limit to the project size.
7a Loan
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Can be used for any real estate, inventory, working capital, or receivables.
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It is usually a variable rate loan, not fixed as in the 504.
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It is frequently uses all available assets of the borrower and not just the collateral of the project being financed as in the 504 loan.
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7a loans typically require more than 10% down.
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7a loans are typically for shorter terms than the 504 loan.
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7a loans are done with the bank only, there is no CDC involved.
New Debt Refinance Without Expansion
The project starts with an appraisal to determine the amount of loan available.
The maximum amount available to lend based on the appraisal is:
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90% no cash out
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85% if cash out
Disbursal must be within 9 months of approval.
For the refinance of any federally guaranteed loan, the new installment payment must be at least ten percent lower than existing loan payment.
EBE (eligible business expenses cash out) will be excluded from this calculation.
Provide written proof that the present lender is either unwilling or unable to modify the current payment schedule.
The jobs requirement is modified to allow the existing jobs to be used to qualify the jobs requirement.
This number is calculated from the existing full and part time employees at the time of application.
Otherwise the public policy or community development goals, as well as the energy goals may be used, if applicable.
The business must have been in operation for two years.
The debt can be no younger than 6 months.
All of the debt to be refinanced was used for the business.
The existing debt to be refinanced is the most recent debt, even if it has refinanced other debt that is eligible
85% of the debt to be refinanced must have been for an eligible fixed asset.
Acquired, constructed, or improved:
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Construction
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Land
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Building
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equipment
EBE ( Eligible Business Expenses) Cash out can be no more than 20% of a project. Cash out is available for payments due within eighteen months, the expenses cannot already be paid.
EBE (Eligible Business Expenses):
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Salaries
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Rent
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Utilities
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Inventory
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Business line of credit
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Business credit card
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Other expenses that are not capital expenses
No personal expenses.
Must be itemized.
Must Include a CDC certification that the EBE (eligible business expenses) are eligible.
Loan Servicing
FOR ANY QUESTIONS ABOUT YOUR EXISTING LOAN PLEASE CONTACT DAVID POOLE:
David@efc504.com | (909) 792-3803 x 103 | or fax to (909) 792-3813
Mail to: 300 E. State St., Ste. 230M, Redlands, CA 92373
How do I check my balance?
Wells Fargo does not provide monthly statements, instead you should have received an amortization schedule just after your loan funded. Your amortization schedule is a breakdown of your monthly loan payment for the life of your loan. If you want to view the payments you have made to date, contact David Poole.
How do I payoff my loan?
Loan prepayments are made once a month on the third Thursday. If you wish to pay your outstanding loan balance, please contact Enterprise Funding with a request to do so. All payoff request must be received prior to the 31st of the month prior to payoff.
Please include the following information in your request:
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Month of expected payoff
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Loan Number
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Escrow or bank contact info if available
How much interest have I paid?
If you need a copy of your 1098 statement for interest paid please send email to David Poole
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1098 Statements not available until after January 31st.
To change the reporting of interest on your loan to the IRS Complete a W-9 form and send to David Poole.
How can I change my account for automatic debit payment?
If you want to change the account that is automatically debited for your monthly payments please submit a new ACH Form and a voided check to David Poole.
Submitting required property insurance
CDC must at all times have a current copy of your Hazard Insurance, Workers Compensation and/or Business Personal Property. We ask that your insurance agent include the following on the proof of insurance.
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In the form of an Acord 28 (Evidence of Commercial Property Insurance) showing Replacement Cost coverage on building and Equipment (if any)
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Borrower's name, loan number, property address, policy number and expiration date
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CDC and SBA named as 2nd mortgagee and loss payee
Enterprise Funding and U.S. Small Business Administration, and their successors and/or assigns, as their interests may appear.
Submitting current financials
Current financial information is required to be submitted on an annual basis. Please submit them to David Poole.
Changing the structure of the loan
Any changes to the structure of your loan must have prior written conset from SBA. Examples are:
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Change of form
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Assumption
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Change of Ownership
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Change of Management