Seedcopa and SeedcoDE Share News of Historically Low SBA Loan Rates
Seedcopa and SeedcoDE, affiliates of the Chester County Economic Development Council help businesses get the money they need to start, grow and expand through a variety of loan programs. By working with programs available through Federal, State and Local agencies, they are able to facilitate loans that compliment conventional, commercial loans.
In fact, interest rates for the Small Business Administration’s (SBA) 504 loan program has dipped to historic lows. According to the National Association of Development Companies (NADCO), “Borrowers of SBA 504 loans this month will be in the first class of small business borrowers with 504 financing fixed at a rate below 4% in the program’s history.”
As announced in Seedcopa’s monthly #RateTracker e-blast, which shares new loan rates as soon as they’re released, the SBA 504 loan’s 20-year effective rate for June is 3.98%, edging below the 4.01% record set in December 2012. “This is the first time a 20-year 504 effective rate calculation has been this low**,” says NADCO.
“Another standout metric is the 504 rate when compared to the current prime rate,” NADCO continues in a press release. “At 152 basis points under the Bank Prime Rate, the June funding is the furthest below prime that 20-year rates have been since May 2007.
Even if the Federal Reserve makes the two ¼-point policy rate cuts anticipated by the market this year, the 504 effective rate may remain approximately one full point below prime (not including any additional spread over prime charged by many commercial real estate lenders).”
**Based on the current fiscal year borrower fee.