SBA 504 Loan at TD Bank, N.A.

The SBA 504 Loan program offered through TD Bank, N.A. is designed to help small business owners acquire long-term, fixed-rate financing for major fixed assets that will promote business growth and job creation. This specialized program combines the strengths of a Certified Development Company (CDC) and a participating lender to provide a cost-effective financing structure for commercial real estate, owner-occupied facilities, heavy equipment, and certain site improvements. The result is a loan product that supports expansion while preserving working capital and offering predictable repayment terms.

Key Features and Structure

• Dual financing structure: The SBA 504 loan typically involves three parts — a bank or private lender financing (usually up to 50% of the project cost), a CDC-backed SBA 504 debenture (generally up to 40%), and a borrower down payment (typically 10%). TD Bank, N.A. participates as the lending bank partner in this structure, working alongside CDCs to deliver the program benefits.
• Use of proceeds: Financing is available for acquisition, construction, or renovation of owner-occupied commercial real estate, as well as purchase of long-term machinery and equipment. Funds can also be used for land acquisition and site development costs in support of permanent fixed assets.
• Long-term, fixed-rate financing: The SBA portion typically provides long-term amortization (10, 20, or 25 years) with a fixed-rate component, helping businesses lock in predictable payments for major capital investments.

Benefits for Small Businesses

• Lower down payment: Compared with conventional financing, the SBA 504 structure reduces the initial cash outlay required from the borrower, helping preserve working capital for operations and growth.
• Competitive interest rates: The SBA-backed portion tends to offer competitive, fixed rates that reduce exposure to interest rate volatility over the life of the loan.
• Long amortization: Extended repayment terms help lower monthly payments, improving cash flow management for small businesses investing in growth.
• Retention of ownership: By enabling acquisition of real estate and equipment, businesses can avoid leasing costs and build equity in productive assets.
• Job and community focus: The program is tailored to promote local investment and job creation, making it attractive for businesses looking to expand operations and hire locally.

Eligibility and Common Uses

To qualify for an SBA 504 loan through TD Bank, N.A., applicants must be a small business as defined by SBA size standards, occupy the financed property (owner-occupied requirement applies), and demonstrate the ability to repay the loan. Typical eligible uses include:

• Acquisition of owner-occupied commercial real estate
• Construction of new facilities or renovation of existing facilities
• Purchase of long-term machinery and equipment
• Land acquisition and site improvements in support of an owner-occupied project

Application Process

The SBA 504 loan process involves coordination between the borrower, TD Bank, N.A. as the participating lender, and a Certified Development Company (CDC) that issues the SBA-backed debenture. Typical steps include:

1. Initial consultation with TD Bank to discuss project needs and program suitability.
2. Preliminary underwriting and documentation gathering, including business financial statements, owner personal financial statements, project cost estimates, and a business plan or project rationale.
3. Submission of a formal loan application; TD Bank and the CDC review eligibility, collateral, and repayment capacity.
4. Coordination of loan approvals: the bank portion is approved by TD Bank while the CDC proceeds with the SBA 504 portion, which may include a separate closing for the CDC/SBA debenture.
5. Loan closings and disbursement: funds are disbursed according to project milestones and applicable program rules, with ongoing post-closing servicing as needed.

Documentation and Requirements

To streamline underwriting and approval, borrowers should prepare the following documentation:

• Detailed project cost breakdown and use of proceeds
• Business financial statements (historical and projected)
• Federal tax returns for the business and principal owners
• Personal financial statements and resumes of principal owners
• Purchase agreements, construction contracts, or equipment invoices
• Business plan or summary of operations and job creation/retention impact

Fees, Terms and Considerations

Fees related to SBA 504 financing may include CDC processing fees, SBA guarantee fees, appraisal and environmental assessments, and closing costs. TD Bank, N.A. will provide a clear disclosure of all fees and loan terms prior to closing. Borrowers should evaluate:

• Term length and amortization schedule of both the bank and SBA portions
• Interest rate characteristics for the bank-sponsored portion and the fixed-rate nature of the SBA debenture
• Prepayment terms and any potential penalties
• Collateral and personal guaranty requirements

Why Choose TD Bank, N.A. for SBA 504 Financing

TD Bank, N.A. combines regional banking strength with experience in SBA lending, offering personalized service, local decision-making, and the ability to coordinate with CDC partners to deliver SBA 504 financing. Businesses that prefer a blended capital structure to minimize cash outlay and secure long-term, stable financing may find the SBA 504 program at TD Bank to be an efficient solution for strategic capital projects.

Tips for a Smooth Approval

• Start with a clear, realistic business plan and project budget.
• Provide complete and organized financial documentation to accelerate underwriting.
• Demonstrate occupancy plans and job creation/retention forecasts where applicable.
• Communicate openly with both the bank representative and the CDC to align on timelines and requirements.

Final Notes

The SBA 504 loan program through TD Bank, N.A. can be a powerful tool for owners who want to acquire real estate, purchase long-term equipment, or undertake major capital projects while preserving liquidity and securing fixed, long-term financing. Because program rules and eligibility details can change, prospective borrowers should consult with a TD Bank lending representative and their CDC partner to review current terms, documentation requirements, and timelines specific to their project and business profile.

Address Bank: Cherry Hill, New Jersey, United States
Bank: TD Bank, N.A.
Headquarters: Cherry Hill, New Jersey
Products: Loans & Credit
Type: SBA 504 Loan