TALLAHASSEE, Fla.--(BUSINESS WIRE)-- For the second month in a row, the interest rate for Small Business Administration (SBA) 504 loans plummeted to yet another unprecedented low level.

The debenture bonds that funded this month’s 20-year 504 loans were sold to investors at an interest rate of 2.76%, falling below the previous record of 2.85% last month. The 10-year 504 debenture bonds, which are sold bi-monthly, were sold at an interest rate of 1.53% last month, which eclipsed the previous record of 1.81% in November 2010.

The official 20-year 504 loan effective interest rate – the rate small business borrowers pay including servicing fees – should be published by Oct. 10. It is expected the low rate for the debenture bond sales this month will result in an estimated effective interest rate of only 4.60% for a 20-year loan. The official 10-year 504 loan effective interest rate for small business borrowers (which was set last month) is only 3.77%. Both the 20- and 10-year SBA effective interest rates are fixed for the term of the 504 loan and require as little as a 10% down payment.

SBA 504 loans are paired with private-sector commercial loans, providing up to $5 million of small business financing for standard projects and up to $5.5 million for green initiative and small manufacturer projects (SBA loan portions only; there is no limit on overall project size).

Proceeds from 504 loans may be used for the purchase of capital fixed assets, including the purchase, construction, expansion or renovation of commercial property and/or the acquisition of heavy duty machinery and equipment that have a useful life span of at least 10 years.

“For those small businesses that have been considering investing in their own facilities or upgrading their equipment, there has never been a better time to take advantage of these record low 504 interest rates,” said Todd Kocourek, president and CEO of Florida First Capital Finance Corporation.

Florida First Capital is a non-profit certified development company that promotes economic development and job creation throughout Florida by working with the SBA and private-sector lenders to provide available and affordable financing to small businesses. Florida First Capital lends under the SBA 504 loan program as well as the State of Florida Recycling Loan Program and other small business assistance programs.

For information on SBA or State of Florida small business loans, call 888-320-5504, email info@ffcfc.com or visit www.ffcfc.com.

CONTACT:

Florida First Capital Finance Corporation
Dwight Sumners, 850-681-3601
Communications Director
dwight@ffcfc.com

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