504 Eligibility

Eligible Uses of the 504 Loan

  • Land and building purchases
  • New construction or renovation
  • Major machinery and equipment purchases
  • Furniture and fixtures up to 10% of project
  • Soft costs including all professional fees directly attributed to the project, such as appraisals, environmental studies, title insurance fees, architect fees, engineering fees, and related legal and accounting fees

504 Loan Eligibility Requirements for Small Businesses

  • Building must be owner operated
  • Business must be for profit
  • Business must have a net worth less than $15 million and have an average after tax profit for the last two years below $5 million or must meet the employee tests (for example, most manufacturers with less than 500 employees qualify.)
  • When purchasing an existing building, the business must occupy at least 51% of building, 60% occupancy in a new construction project
  • For equipment financing, the equipment must have a minimum useful life of ten years