Eligible Project Costs

Eligible costs for SBA 504 funding are the purchase, renovation, construction or expansion of owner-occupied real estate. Equipment acquisitions with a useful life of ten years or more are also eligible. A borrower can lower its debt service significantly by combining an equipment acquisition with a real estate project thus reducing the burden of the debt service during the vulnerable expansion phase.

Project related “soft costs” such as appraisal and environmental fees, construction interest, and closing costs are eligible project costs for SBA 504 financing. Financing these costs as part of the project helps preserve precious operating capital to support the business through its planned growth phase.