Access to Capital
SBA 504 Loan Program
The SBA 504 loan program provides viable small and medium size businesses with long-term fixed rate financing for the acquisition or construction of fixed assets. Projects are typically financed 50% private lender, 40% SBA and 10% by the small business.
Project Size
- Projects range between $150,000 and $13,000,000+. The maximum SBA debenture is $5 million or $5.5 for small manufacturing or when meeting the public policy goals of energy reduction or alternative fuels.
Eligible Businesses
- For-profit businesses engaged in manufacturing, retail/wholesale, service and construction that meet the following small business size standards (including affiliates):
- Tangible net worth less than $15 million, and;
- Average annual net profit after tax for the previous two years of less than $5.0 million
Eligible Project Costs
- Land and building improvements
- Building construction, acquisition, expansion or renovation
- Equipment acquisition
- Soft costs: Professional fees, Interest, fees and points on the interim bank loan
SBA Loan Terms
- 10 years for equipment
- 10 or 20 years for real estate and equipment combined
- Down Payment: 10% of project costs and 15-20% for special purpose buildings or start-ups
Processing Time
- 30-60 days from the date of application
SBA-504-Program-Detailed-Overview(PDF, 210KB)
The Michigan Economic Development Corporation has several programs that can help small business throughout Michigan receive loans from banks and lending institutions to help their businesses grow and succeed. MEDC works directly with lenders who in turn can provide traditional financing to small businesses.
Small business owners in need of financing or loan support, are encouraged to find a participating lending institution based on the program of interest. Small business owners should feel empowered to talk with their local branch or lending institution and have them contact MEDC if they are not already part of Capital Access.
Private Activity Bonds – Industrial Revenue Bonds
Private activity bonds are an attractive source of financial assistance to certain eligible economic development projects. They provide profitable firms with capital cost savings stemming from the difference between taxable and tax-exempt interest rates.
Private-Activity-Bond-Program-Industrial-Revenue-Bonds-Overview.pdf(PDF, 365KB)
CEED Lending is an initiative of the Great Lakes Women’s Business Council (WBC). Providing business expansion and start-up financing to small business loans in the following nine southeast Michigan counties: Wayne, Oakland, Macomb, Monroe, Jackson, Hillsdale, Lenawee, Livingston, and Washtenaw.
ProsperUS makes capital (money) available to people who wouldn’t be able to apply via traditional funding routes. ProsperUs is a non-traditional lender that makes high-risk loans of up to $50,000. They work with you through the application process to help you get approved, and offer additional support through our Business Services program as needed. They regularly collaborate with other funders for loans larger than $50,000.
PACE is a financing tool that enables cashflow positive investment in comprehensive energy efficiency, water efficiency and renewable energy projects. By financing such projects through PACE, businesses can eliminate the need for upfront capital and spread the costs over up to 25 years so that the savings generated from the project are greater than the annual PACE loan repayment – generating immediate positive cash flow.