Anthony Saya: Business cash infusion helps businesses grow: The SBA 504 Loan Program can be the right tool

Now is a terrific time to invest in your business. The Small Business Jobs Act has improved loan incentives for buying real estate or equipment for businesses, and business owners should consider taking advantage of them. For small business owners seeking to grow by purchasing property or equipment, the SBA 504 loan program can be the right tool to get the deal done, especially with important enhancements through the Small Business Jobs Act. A fixed asset loan, at a fixed rate. The SBA 504 Program lends to businesses specifically for major fixed assets such as real estate, buildings, and some equipment and machinery. This loan helps small businesses make significant investments while preserving working capital by providing a fixed interest rate for 10 years on equipment and 20 years on real estate with only a 10 percent down payment from the business. Generous terms, but restrictions apply. While interest rates and terms are more generous than conventional financing, job creation requirements and eligibility guidelines do apply. However, that eligibility has been enhanced through the new act. Businesses whose net worth is not more than $15 million or whose average net income for the preceding two completed fiscal years does not exceed $5 million are eligible for an SBA 504 loan. The limit for 504 loans has also been permanently increased to $5 million for most applications and to $5.5 million for manufacturers and green projects. A general purpose loan, at a variable rate. In addition to the SBA 504 program, the SBA 7a program has also been improved with an increased loan size and enhanced eligibility. An SBA 7a loan can be used to expand, acquire or start a business; refinance existing business debt; provide working capital or purchase inventory, as well as purchase or construct real estate and buy equipment. The rates for the SBA 7a are variable, and they are adjusted quarterly. The advantages of SBA lending, a good idea in any business climate, have only intensified during current challenges, thanks to the enhancements through the Small Business Jobs Act. Talk with a bank that has expertise in SBA lending to learn about the best financing options for your business. Anthony Saya is KeyBank's SBA lending specialist in the Syracuse and Rochester areas, N.Y.