The U.S. Small Business Administration established the 504 Loan Program to provide growing businesses with long-term, fixed-rate financing for the purchase or refinance of major fixed assets, such as land, buildings, machinery, and equipment.

How this helps you:

1. Working in conjunction with a conventional bank the SBA 504 program allows your project to be financed with just a 10% equity injection from you.  Typical bank financing requires 20%.  This will differ if your business is a start-up and/or the property is determined to be single purpose, such as a hotel.  An additional 5% down is required for each.  With financing available for up to 90% of the project cost, SBA 504 loans offer an affordable down payment, enabling the entrepreneur to conserve working capital and retain liquidity to meet operating needs.
2. Typical bank-only financing involves an adjustable rate during the life of the loan.  With the SBA 504 program, 40% of your project will be funded by the U.S. Small Business Administration at either a 25-year or 20-year fixed rate (10-year for equipment) and is typically below the banks initial loan rate.