Lenders - Texas Certified Development Company

TxCDC YOUR LENDING PARTNER

We are not your competitor; we are your partner! As the largest 504 Lender in Texas, we partner with banks throughout Texas on commercial loans ranging from $175,000 to over $5.5 million. We’ll coordinate the entire 504 Loan process and work to ensure everything goes smoothly for your client.

Bank Benefits

Reduced lending exposure with 50% loan-to-value
Manages commercial real estate concentration issues
Opens up lending availability
Maximizes middle market lending
High size limits and business size caps
Preserves borrower's working capital, which keeps cash in deposit accounts
Can refinance commercial mortgages with cash out for business expenses
Unique marketing opportunity
Finances heavy machinery and equipment
Attracts new borrowers
We are your partner, not your competitor…you keep your clients
The 504 Loan Program can be used multiple times

Key Points For Banks

The Bank’s Role in the 504

Provides interim funding and sets rate for interim loan until the deed is recorded
Bank’s term must be at least 10 years for SBA 20- or 25-year terms, and the bank’s term must be at least 7 years for SBA 10-year terms.
Bank gets first lien on all project assets
Financing up to 95% of the appraised value on real estate (5% variance)
Size Standards: a tangible net worth of less than $15 million and profits (after taxes) of less than $5 million (including affiliates)
Economic life of the asset to be financed needs to meet or exceed the loan term

Qualifying Projects:

Generally, any project involving the purchase, construction, or improvement of fixed assets is eligible. Examples include:

Land and building acquisition
Construction and renovation
Purchase of heavy machinery or equipment
Refinancing real estate and equipment
Reasonable contingencies (up to 10 percent), furniture and fixtures, and soft costs (such professional fees and interest during construction) generally can be included. Investment and residential properties are not eligible.

Eligible Businesses:

Business owner(s) must be a U.S. citizen or lawful permanent resident alien
Business must be for-profit
Any business structure (Sole Proprietorship, Partnership, Corporation, LLC, LLP, etc.)
Any type of legitimate business: manufacturing, wholesale, service, professional service, retail or agricultural
By SBA definition the business must be small. This generally means less than $15 million in net worth and less than $5 million in annual after tax profits.

Ineligible Businesses:

Private restrictive clubs and speculative real estate investments
Businesses primarily engaged in lending (i.e. banks, credit unions, finance companies)
Insurance companies, although independent insurance agencies are eligible
Offshore facilities
Businesses that derive a significant portion of their revenue from speculative operations (i.e. commodity traders)
Lobbyists
Businesses with more than 1/3 of their revenue from legal gambling