The March 2024 SBA 504 debenture pricing was completed on March 7, 2024.

25 Year Term 6.55%

20 Year Term 6.65%

10 Year Term 6.89%

The SBA offers a 504 Loan with a 25-year maturity for the acquisition of owner-occupied commercial real estate and related costs. This is in addition to the 10 and 20 year loans currently available in the 504 Loan Program. Loans are typically eligible for up to 90% financing of project costs. Rates include monthly servicing fees to CDC, SBA, and central servicing agent; based on SBA FY24 fees. SBA 504 refi rates are approximately 3 basis points higher than debenture pricing noted above.

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SomerCor’s origination and credit teams were on hand for in-person training with the National Association of Development Companies (NADCO) this week. It was a great opportunity to learn best practices and connect with other industry experts.

Pictured: Darin Gehrke, Manish Laroia, Margaret Griffin, Eric Bacon, Katy Do, and Lis Williams.

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SBA Updates Alternative Size Standard

Effective March 18, 2024, the U.S. Small Business Administration will make permanent the Alternative Size Standard for 504 and 7(a) loan programs, updated for inflation.

• Tangible Net Worth not more than $20 million (up from $15 million), and
• Average Net Income after Federal Income Taxes for the two full fiscal years before the SBA application date not more than $6.5 million (up from $5 million)

The change represents a nearly 35% increase to account for inflation that has occurred since the interim alternative size standard was last adjusted in 2010. Additionally, the SBA will continue to monitor inflation and other economic indicators and their impacts, and adjust size standards as needed. The SBA will adjust the alternative size standard for inflation on a five-year schedule.

Once this Final Rule becomes effective, more small businesses will be eligible to take advantage of SBA lending programs

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