About 504 Loans

About 504 Loans

Fund your Business With an SBA 504 Loan

Our mission is simple: help small business be their best. We do that by providing low interest, fixed-rate small business loans called SBA 504 loans. We provide 10, 20 or 25 year terms, so you can apply for the loan best suited for you. 

Borrowers can apply for loans ranging from $100,000 to $5 million, so no matter the business, we’re able to help provide the funding that fits into your plans.

The loans are available across South Dakota, include takeout financing, and can be used to refinance qualified existing adjustable rate loans.

SBA 504 Loan Structure

While each business and loan is unique, our SBA 504 loans typically have a 50-40-10 structure. Here’s what that means.

  • 50% is financed a regulated lender that receives a first mortgage position on all project collateral.
  • 40% is provided by the South Dakota Development Corporation. We sell debentures guaranteed by SBA and receive a subordinated collateral position.
  • 10% is provided by the borrower in a cash equity injection. This is the minimum equity contribution. The SDDC may require a larger contribution depending on the project and personal available resources.