SBA 504 Loan at Ameris Bancorp — Long‑Term, Fixed‑Rate Financing for Business Growth

The SBA 504 loan program is designed to help small businesses acquire major fixed assets — commercial real estate, owner‑occupied buildings, and long‑life equipment — with predictable, long‑term, fixed‑rate financing and lower down payment requirements than many conventional options. Ameris Bancorp participates in this program by combining its local lending capabilities with Certified Development Company (CDC) partnerships to deliver tailored 504 solutions for business owners who want to expand, modernize, or stabilize their operations.

What the SBA 504 Program Offers

• Long‑term fixed rates: The SBA‑backed portion is typically funded through debentures with fixed interest rates and extended amortizations (commonly 10, 20, or 25 years), which helps reduce monthly payments and interest‑rate risk.
• Lower down payment: Traditional 504 structures allow borrowers to preserve cash by requiring a modest down payment (often around 10%), compared with larger equity requirements for unconsolidated commercial loans.
• Financing for major fixed assets: Eligible uses include purchasing land, constructing or renovating an owner‑occupied building, and purchasing long‑term heavy machinery and equipment essential to business operations.
• Combination financing: A typical transaction is structured with three parts: a senior loan from a private lender (Ameris Bancorp), a junior loan from a CDC backed by the SBA, and a borrower equity contribution.
• Stability and predictability: Fixed payments and extended amortization schedules provide clarity for budgeting and long‑range planning.

Typical 504 Loan Structure

While structures can vary depending on the project and borrower profile, a representative SBA 504 transaction often looks like this:

• Senior Lender (Ameris Bancorp): finances up to approximately 50% of the project cost.
• CDC/SBA‑backed Loan: finances approximately 40% and is issued as a fixed‑rate debenture.
• Borrower Equity: typically provides about 10% of the project cost. Higher equity may be required for start‑ups, special purpose properties, or additional risk factors.

Eligibility Highlights

SBA 504 loans are intended for for‑profit small businesses. Standard eligibility considerations include:

• Business size: The business must meet SBA small business size standards. For the 504 program, typical thresholds include a tangible net worth less than $15 million and average net income after federal income taxes of $5 million or less for the last two years.
• Use of proceeds: Funds must be used for eligible fixed asset purchases or improvements. Refinancing existing debt may be allowed in specific circumstances that support business growth and job retention.
• Owner‑occupancy: For real estate purchases, the borrower generally must occupy a substantial portion of the property (owner‑occupied requirement), especially for existing properties or new construction.
• Credit and cash flow: Demonstrated ability to repay through historical results and reasonable projections is required.

Common Uses of SBA 504 Financing

• Purchase of owner‑occupied commercial real estate
• Construction of new facilities or expansion of existing buildings
• Renovation and tenant improvements to adapt space for business needs
• Purchase of long‑life, fixed machinery and manufacturing equipment
• Land acquisition for future business development

Advantages of Choosing an SBA 504 Loan Through Ameris Bancorp

• Local decision‑making, national program benefits: Ameris Bancorp blends community bank responsiveness with the long‑term stability of SBA 504 financing.
• Experienced team: Dedicated lending specialists can guide borrowers through eligibility, structuring, and CDC coordination to streamline the process.
• Competitive overall financing: By combining a bank loan with an SBA‑backed CDC portion, borrowers often achieve lower down payments and competitive overall costs compared with all‑private financing for similar projects.
• Customized solutions: Ameris Bancorp can structure transactions that consider client balance sheet goals, tax planning, and growth strategies while leveraging SBA program features.

Application and Approval Process

The SBA 504 financing process involves coordinated steps between the borrower, the private lender, and the CDC. While timelines vary with project complexity, the general sequence includes:

1. Pre‑qualification: Initial discussion with an Ameris Bancorp loan officer to assess project scope, estimated costs, and preliminary eligibility.
2. Documentation: Gather business financials, tax returns, projections, ownership resumes, purchase or construction contracts, and collateral details.
3. Underwriting: Ameris Bancorp performs credit underwriting for the senior loan; the CDC evaluates and prepares the SBA portion for funding.
4. CDC and SBA submission: The CDC assembles the SBA application and debenture request for approval and funding.
5. Closing and funding: Once approvals are received, the loan documents are executed and funds are disbursed in accordance with project milestones.
6. Post‑closing administration: Ongoing servicing details are handled by the appropriate parties according to loan documents.

Documentation Typically Required

To evaluate an SBA 504 request, Ameris Bancorp and the CDC generally request:

• Business tax returns and financial statements for recent years
• Personal tax returns and personal financial statements for principals
• Business plan or project summary and feasibility analysis
• Operating projections showing ability to service debt
• Purchase contracts, construction bids, or equipment quotes
• Corporate documents, leases, and environmental assessments if required

Considerations and Responsibilities

While SBA 504 loans provide attractive features, borrowers should account for program specifics:

• Personal guarantees: Principals with significant ownership typically must provide personal guarantees.
• Collateral and lien position: Senior lenders usually hold first lien on financed assets; the CDC/SBA holds a secondary lien on the project collateral.
• Project eligibility: Not all property types or speculative projects qualify; the borrower’s intended use and business plan should align with program rules.
• Documentation and timeline: SBA 504 involves additional documentation and coordinated approvals, so planning ahead helps keep projects on schedule.

Who Benefits Most

Ideal candidates for SBA 504 financing include growing small businesses that need to acquire or improve long‑term assets and prefer predictable, fixed monthly payments. Owner‑operators planning to secure real estate for their own use, manufacturers investing in production equipment, and companies expanding physical capacity often find the program particularly advantageous.

Why Work with Ameris Bancorp

Ameris Bancorp brings the strengths of a community‑focused lender together with practical experience managing SBA transactions. Borrowers gain access to personalized service, local underwriting insight, and a partner who understands how to structure projects to align with SBA 504 requirements. Ameris Bancorp works with CDC partners to facilitate approvals, manage documentation, and help clients execute capital projects that support long‑term business success.

Next Steps

If you are considering a long‑term financing solution to acquire, build, or upgrade fixed assets, begin with a conversation about project goals and a preliminary review of eligibility and structure. Through careful planning and collaboration, an SBA 504 loan can be a powerful tool to preserve working capital, reduce financing costs, and create predictable repayment terms that support sustainable growth.

Address Bank: Atlanta, Georgia, U.S.
Bank: Ameris Bancorp
Headquarters: Atlanta
Products: Loans & Credit
Type: SBA 504 Loan