SBA 504 Loan — Truist Financial

The SBA 504 loan through Truist Financial is designed to help growing small businesses acquire long‑term, fixed‑rate financing for major fixed assets. This program pairs bank financing with a Certified Development Company (CDC) and the U.S. Small Business Administration to deliver a structured, predictable capital solution for owners who need to purchase, construct, or modernize commercial real estate or large equipment. Truist combines local relationship banking with the specialized benefits of SBA 504 structure to support investment in long‑lived assets that drive growth, stability, and job creation.

Key features

• Long‑term financing tailored for fixed assets — commonly available in terms suitable for commercial real estate and equipment investments.
• Dual‑partner structure — typically a conventional first mortgage from Truist and a CDC/SBA‑backed second mortgage, with the borrower contributing equity.
• Fixed interest rate on the SBA‑backed portion providing predictable long‑term payments.
• Competitive down payment requirements compared with conventional financing for similar asset classes.
• Designed to support business expansion, modernization, and job retention or creation.

How it works — structure overview

The SBA 504 model is a three‑party financing structure. Truist often provides a conventional first mortgage covering a substantial portion of the project cost, while a CDC arranges the SBA‑backed second loan for the remaining financed portion. The borrower contributes a down payment or equity injection. The combination reduces the borrower’s upfront cash requirement while preserving long‑term, fixed‑rate financing for a portion of the project. Exact loan percentages, terms, and amortization schedules depend on the project type, borrower profile, and prevailing program guidelines.

Typical uses

• Acquisition of owner‑occupied commercial property (office, retail, industrial, medical, etc.).
• Construction of new facilities or major renovation and expansion of existing facilities.
• Purchase or long‑term financing of heavy machinery and manufacturing equipment.
• Site improvement, utilities, and certain soft costs directly related to the project.

Eligibility overview

To qualify for an SBA 504 loan through Truist, applicants must meet SBA program requirements and Truist’s lending standards. Generally, eligible borrowers are for‑profit small businesses that meet SBA size standards, demonstrate sufficient creditworthiness, and propose a project that supports business operations and economic impact. Projects are evaluated for feasibility, collateral value, management capability, and alignment with SBA program objectives. Specific eligibility thresholds and documentation requirements are determined during the application process.

Benefits

• Lower initial cash outlay compared with entirely conventional financing, freeing capital for working capital or other needs.
• Fixed‑rate financing on the SBA portion, which reduces exposure to rising interest rates over the long term.
• Potential for longer amortizations than many conventional loans, improving monthly cash flow.
• Access to both local banking expertise at Truist and federal SBA program advantages delivered by CDC partners.

Considerations and trade‑offs

• Process complexity: SBA 504 loans involve coordination between the bank, CDC, and SBA, which can extend processing time compared with simple conventional loans.
• Eligibility and documentation: borrowers must supply detailed financial statements, projections, and project plans; underwriting standards are rigorous.
• Use restrictions: proceeds must be used for approved project costs under SBA rules; some types of businesses or uses may be ineligible.
• Additional fees: there are program‑related fees associated with the CDC and SBA portion that should be considered in total project cost analysis.

Application process — what to expect

1. Initial consultation with a Truist relationship manager to review the project scope, financing needs, and preliminary eligibility.
2. Submission of a formal loan application package including business and personal financial statements, tax returns, project cost estimates, and use of proceeds.
3. Coordination with a CDC partner to structure the SBA‑backed portion and to obtain SBA approval and debenture financing.
4. Underwriting, appraisal, environmental review, and final documentation.
5. Closing and funding once all approvals and conditions are satisfied.

Common documentation

• Business and personal tax returns (typically multiple years).
• Interim and historical financial statements, including balance sheets and profit & loss statements.
• Business plan or project narrative, including anticipated economic impact and job creation or retention where applicable.
• Detailed project cost breakdown, contractor proposals, and equipment invoices.
• Legal documents such as leases, organizational agreements, and title information for real estate.

Tips for a successful application

• Prepare organized, complete documentation to speed underwriting and review.
• Provide a clear project plan that explains the business need, timeline, and benefits.
• Work with experienced advisors — Truist’s commercial lenders and CDC partners can guide you through SBA‑specific requirements.
• Consider realistic cash flow projections and include contingencies for cost overruns or delays.

Who should consider an SBA 504 loan?

Small business owners who require long‑term, fixed‑rate financing for real estate or large equipment purchases, and who want to preserve working capital, may find the SBA 504 structure attractive. It is especially useful for owner‑occupants investing in their facility or manufacturers and heavy equipment users seeking affordable, long‑term financing. Businesses preparing for multi‑year growth and needing predictable debt service often benefit from the program’s stability.

Final notes

The SBA 504 loan offering at Truist Financial blends local banking capabilities with SBA program advantages to help businesses invest in durable assets. Program details, availability, and terms are subject to SBA regulations and Truist underwriting criteria. Prospective borrowers are encouraged to consult a Truist commercial lender to explore how a 504 structure could fit their project and long‑term financial plan.

Address Bank: Truist Center, Charlotte, North Carolina, U.S.
Bank: Truist Financial
Headquarters: Charlotte
Products: Loans & Credit
Type: SBA 504 Loan