MetaFund Provides SBA 504 Credit Enhancement Program

Posted by Blake Trippet on 06/01/2013

Small Business Administration (SBA) 504 Loans: 

  • A loan program designed to provide growing small businesses with long-term, fixed rate financing for major fixed assets such as equipment or real estate     
  • Usually includes:
    • A secured, senior loan from a bank covering 50% of the total project cost
    • A second, SBA guaranteed loan from an SBA Certified Development Company covering 40% of the total project cost
    • A borrower contribution of the remaining 10%
    • Many companies who could benefit from this program experience difficulties coming up with the required 10% because they lack the necessary liquidity.  MetaFund can fill the gap!

MetaFund is a certified Community Development Financial Institution (CDFI) which invests in companies that are located in distressed areas or are improving the lives of low-to-moderate income individuals.  MetaFund’s investment structure is very flexible.  It can partner with the business to provide the required 10% through equity or near equity financing.  MetaFund has successfully used these structures to satisfy the SBA capital requirement for the borrower and, in doing so, has overcome the common barrier to making an SBA 504 loan a reality.

MetaFund only offers this in cooperation with its partner banks.  All projects must first be submitted and approved by a partner bank who will then make a referral to MetaFund.  A list of partner banks can be found at the link below.

List of Partner Banks