More Maui small business owners with eligible commercial real estate can soon secure more stable, long-term financing as the U.S. Small Business Administration’s temporary 504 refinancing program expands April 6.
In February, SBA implemented a temporary refinancing program enacted under the Small Business Jobs Act of 2010, which allowed small businesses facing maturing commercial real estate mortgages or balloon payments before Dec. 31, 2012, to refinance with an SBA 504 loan. The SBA change will lift the date limitation and will allow more small businesses to secure stable, long-term financing and avoid potential foreclosure on mortgages approved before and during the recession that were based on inflated real estate values. The program runs through Sept 27, 2012.
“With the collapse of the real estate bubble, many small business owners have found themselves unable to refinance as a result of inflated real estate values at the time they took out their mortgage,” SBA Administrator Karen Mills said in a statement this week. “SBA’s temporary 504 refinancing program was first made available to those small businesses with the most immediate need. Today’s step opens this critical assistance to more small businesses, giving them the opportunity to restructure their debt and free up capital that will be essential to keeping their doors open and also their future ability to grow and create jobs.”
To be eligible, a business must be in operation for at least two years, the property owner-occupied, and the debt incurred no less than two years prior to the date of application. Proceeds can be used for 504-eligible business expenses, and payments on previous debt current 12 months back.
To find a list of lenders in your area, go to the SBA Hawaii District website.