SBA Loans Explained: SBA 504 and SBA 7(a) Loans for Small Businesses ​

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SBA Loans for Small Businesses.

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Since 2008, Commercial Partners of Texas has helped small business owners secure affordable financing through SBA loan programs. Our SBA Lending Department specializes in SBA 504 Loans and SBA 7(a) Loans ranging from $150,000 to $13 million for businesses throughout Texas.

Whether you are purchasing commercial real estate, constructing a new building, refinancing existing debt, purchasing equipment, or expanding your operations, SBA financing offers flexible terms, low down payments, and long-term repayment options designed to help small businesses grow.

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What Is an SBA Loan?

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An SBA loan is a business loan partially guaranteed by the U.S. Small Business Administration (SBA). The SBA does not directly lend money in most cases. Instead, it works with approved lenders to reduce risk and make financing more accessible for small businesses.

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SBA loans are widely considered some of the most attractive financing options available because they offer:

• Lower down payment requirements

• Longer repayment terms

• Competitive interest rates

• Higher loan amounts

• Flexible use of funds

• Fully amortizing loans with no balloon payments

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SBA 504 Loan Program

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The SBA 504 Loan Program is designed specifically for owner-occupied commercial real estate and long-term equipment purchases.

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SBA 504 Loan Highlights

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• Loan amounts up to $13 million

• As little as 10% down payment

• Up to 90% financing available for qualified borrowers

• Fixed-rate financing available

• Fully amortizing loans with no balloon payments

• Terms up to 25 years

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Eligible Uses for SBA 504 Loans

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SBA 504 financing can be used for:

• Purchasing commercial real estate

• Buying land for future development

• Ground-up construction projects

• Acquisition of existing buildings

• Building expansion and renovations

• Major equipment purchases

• Manufacturing equipment

• Warehouse and industrial facilities

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SBA 504 Occupancy Requirement

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The property must be primarily occupied by the borrowing business. Typically, at least 51% of an existing building or 60% of a newly constructed building must be owner-occupied.

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SBA 7(a) Loan Program

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The SBA 7(a) Loan Program is the SBA's most versatile financing solution and can be used for a wide variety of business purposes.

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SBA 7(a) Loan Highlights

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• Loan amounts up to $5 million

• Up to 90% financing available

• Terms up to 25 years for real estate

• Fully amortizing loans with no balloon payments

• Competitive interest rates

• Flexible use of proceeds

 

Eligible Uses for SBA 7(a) Loans

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SBA 7(a) loans can be used for:

• Commercial real estate acquisition

• New construction projects

• Equipment purchases

• Inventory financing

• Working capital

• Business acquisition

• Debt refinancing

• Partner buyouts

• Business expansion

• Cash-out refinancing for eligible business purposes

SBA 7(a) Occupancy Requirement

Like SBA 504 loans, commercial real estate financed through the SBA 7(a) program must generally be owner-occupied by the business.

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Benefits of SBA Financing

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Many small business owners choose SBA loans because they provide advantages unavailable through conventional financing.

Lower Down Payments

Traditional commercial loans may require 20% to 35% down. SBA programs can reduce that requirement to as little as 10%.

Longer Loan Terms

Longer repayment periods help reduce monthly payments and improve cash flow.

Preserve Working Capital

By financing up to 90% of project costs, businesses can retain cash reserves for operations, payroll, inventory, and future growth.

Competitive Interest Rates

Because SBA loans are partially guaranteed by the federal government, lenders can often offer attractive rates and terms.

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Who Qualifies for an SBA Loan?

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General SBA loan requirements include:

• For-profit business operating in the United States

• Owner-occupied commercial property (for real estate loans)

• Demonstrated ability to repay the loan

• Reasonable owner equity investment

• Acceptable credit history

• Business size that meets SBA eligibility guidelines

Every transaction is unique, and qualification requirements may vary depending on the loan program and lender.

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What Is the Small Business Administration (SBA)?

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The Small Business Administration (SBA) is an independent federal agency established in 1953 to support and strengthen America's small businesses.

The SBA helps entrepreneurs and business owners by providing:

• Access to capital through SBA loan programs

• Business counseling and mentorship

• Entrepreneurial training programs

• Government contracting opportunities

• Small business advocacy

Today, SBA-backed financing remains one of the most important funding sources for small businesses nationwide.

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Why Choose Commercial Partners of Texas for SBA Loans?

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Commercial Partners of Texas has been helping Texas business owners secure financing since 2008. We work with a broad network of SBA lenders and funding sources to help clients obtain competitive financing solutions for:

• Commercial real estate purchases

• Ground-up construction

• Building expansion projects

• Equipment financing

• Debt refinancing

• Business acquisitions

• Working capital needs

Our team serves businesses throughout Houston, Dallas, Austin, San Antonio, Fort Worth, and communities across Texas.

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Apply for an SBA Loan Today

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If you are considering purchasing commercial real estate, building a new facility, refinancing existing debt, or expanding your business, SBA financing may be the ideal solution.

Contact Commercial Partners of Texas today to discuss your SBA 504 Loan or SBA 7(a) Loan options and determine which program best fits your business goals.

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