Since more than half of Americans either own or work for a small business, we celebrate America's small businesses and the big contributions they make in our local communities and to our national economy. Every year since 1963, National Small Business Week, April 29 – May 5, 2018, is our chance to salute the small business owners who create two out of every three jobs for Americans. Despite being the key to our nation's recovery after the recession, many small businesses cannot get the funding they need to expand their operations.
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.
The old adage "good things come in small packages" certainly applies to our recently closed loan for Perrier Esquerre Contractors LLC. The owners were renting a commercial space and wanted to purchase land and a larger building from which to operate their company. Community Business Finance was pleased to help this company obtain financing through the 504 Loan Program with a total project cost of less than $350,000. In fact, the SBA portion of the loan was less than $150,000, much lower than most home mortgages these days.
It's time to celebrate America's small businesses and the big contributions they make in our local communities and to our national economy. National Small Business Week, April 30 – May 6, 2017, is also our chance to salute the small business owners who create two out of every three jobs for Americans. Despite being the key to our nation's recovery after the recession, many small businesses cannot get the funding they need to expand their operations.
The SBA 504 Loan Program was created to provide long-term financing to small businesses for the purchase or improvement of land, buildings and major equipment. The 504 Debt Refinancing Program allows those who already have such debt, through a non-SBA loan, to refinance it into long-term, fixed-rate loans. This program is invaluable to entrepreneurs and small business owners who need to reduce their high-cost debt, including adjustable-rate debt.
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.
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.
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.
Most business owners will eventually confront the issue of whether to purchase or lease their office space. It is important to remember that by not owning your business property, you are forfeiting substantial financial benefits that could improve your bottom line. Now is the time to consider property ownership, and Community Business Finance's 504 Loan Program offers a way for businesses to purchase commercial property with as little as a 10% down payment and a below-market fixed interest rate.