Before you renew the lease on your building this year, you should consider the many benefits of owning your business property. Ownership provides financial advantages that leasing cannot, while offering control and long-term consistency. Through the 504 Loan Program, you can secure a mortgage with monthly payments that are often lower than your current rental amount, as well as a low down payment.
Community Business Finance recently helped a client in Louisiana purchase property with a 504 Loan. The commercial janitorial service was unfamiliar with the 504 Loan Program, however the proceeds enabled the owners to buy the building that they had been leasing for many years. With a 504 Loan, they were able to put only 10% down and are very happy with a 20-year fixed rate mortgage on the SBA's portion of the loan.
For businesses seeking property or equipment loans, finding the lowest interest rate can seem like the best move. However, bear in mind that the interest rate is only one aspect of your loan contract, and it doesn't mean you will pay the least amount of money over the life of the loan. Therefore, the loan with the lowest interest rate might not actually be the best loan for your business. In fact, Community Business Finance's 504 Loan Program has many advantages over a conventional loan.
While it might seem easier to renew the lease on your building, you should consider the many advantages of owning your business property. Even though there are costs associated with moving to a new location, property ownership can have a significant positive impact on your business. With the 504 Loan Program, owning provides financial advantages that leasing cannot, while offering control and long-term consistency.
Community Business Finance's 504 Loan Program has many advantages over a conventional loan. For businesses seeking property or equipment loans, finding the lowest interest rate seems like the best move. However, bear in mind that the interest rate is only one aspect of your loan contract. Therefore, the loan with the lowest interest rate might not actually be the best loan for your business. Let's examine the differences between conventional loans and 504 loans.
We have exciting news to share at Community Business Finance. Roger DeGregori, owner of Fish Gallery, has opened his fourth store in The Woodlands, Texas. Roger used the 504 Loan Program to continue to expand his childhood hobby into the booming business it is today. We have detailed Fish Gallery's beginning in our Success Stories, where Roger describes how his first 504 loan was a lifesaver for his company.
US Hotel rooms under construction are up over 20% from a year ago, according to the STR Pipeline Report, and consumer demand is still increasing. In fact, economy hotels in the planning or construction phase are up a whopping 63%! How can hotels, especially smaller hotels, afford to keep pace with such soaring demand? Since hotel properties are not easily converted to other uses, they are considered special purpose properties by commercial lenders. This designation makes financing harder to acquire.
According to data from the Houston District Office of the Small Business Administration, the total dollar amount of SBA loans issued to Houston-area small businesses increased by 15% in fiscal year 2015. FY 2015 saw more than $804 million in SBA loans, up from $688 million in FY 2014, for a record-setting lending year.