RDC webinar – New 504 Debt Refinance Program, August 2021

Play recording (28 mins)

View the Slide Deck

Contact Niccole Zell at niccole@rdc504.org to apply

How to Qualify

  • Business has been in operation for a minimum of two years
  • Business occupies 51% or more of the real estate square footage (investment property is not eligible)
  • Real estate is commercial property (residential property is not eligible)
  • Loan was entered into a minimum of SIX MONTHS ago
  • Loan was originally used to purchase or improve commercial real estate
  • Loan is currently financed using conventional bank financing, SBA 504 financing or SBA 7a financing

 

Debt Refinance Only

You can refinance existing debt up to 90% of the current appraised value

New appraisal required at application.

Example:
Appraised value: $2,000,000
Existing loan: $1,000,000
Loan-to-value 50%

 

Example:
Appraised value: $2,000,000
Existing loan: $1,800,000
Loan-to-value 90%

 

 

Cash Out Refinance

Total Loan-to-Value cannot exceed 85%

Cash out cannot exceed 20% of the appraised value

Eligible costs that can be paid using the cash out:

  • Inventory
  • Accounts payable
  • Payoff / pay down of line of credit
  • Payoff of business credit card debt
  • Working capital expenses

Debt Refinance Structure Examples

Appraised value $1,000,000
85% of appraised value $850,000
Current debt to be refinanced $500,000
Available equity for cash out- 20% of appraised value $200,000

 

Appraised value $1,000,000
85% of appraised value $850,000
Current debt to be refinanced $250,000
Available equity for cash out – 20% of appraised value $200,000

 

Appraised value $1,000,000
85% of appraised value $850,000
Current debt to be refinanced $850,000
Available equity for cash out $0- Maximum 85% already reached