September 2022

FY 2023

504 Loan Program Fees

One thing to know about the 504 loan program is that it is a zero subsidy program. This means taxpayers don't pay for potential losses. Instead, losses are covered by fees paid by the borrowers that use the program.

Just like program interest rates have adjusted to pre-pandemic levels, SBA loan fees will also adjust, and the increase was announced by SBA last week. However, it is important to note that even with an increase from FY 2022, the fees will still be slightly lower than what they were in FY 2021. These fees will go into effect for loans approved after September 30, 2022. 

• The SBA Guaranty Fee (a one-time fee) will be zero basis points for both regular 504 loans and the debt refinance without expansion 504 loans. This is a reduction from 0.50% in FY 2022.
• The Ongoing SBA Guarantee Fee will be:
• 44.05 basis points for regular 504 loans 
• 45.59 basis points for Debt Refinance Without Expansion
• Both are just under 20 basis point increases from fees last year.

Essentially this new fee structure lowers the borrower's up-front one-time fees that get rolled into the final gross debenture amount but increases the fully effective interest rate by just under 20 basis points that the borrower pays over the life of the loan. And as mentioned previously, these ongoing fees that determine the final interest rate are still lower than those paid in FY 2021.

August Fundings

GLCF celebrates another fantastic month! Our team helped 6 Michigan small businesses finance $5,061,000 in SBA 504 financing during August! These funds were used to purchase commercial real estate and/or equipment or refinance existing debt.

To learn more about the benefits of the 504 loan program, please visit our website at www.glcf.org or call our office at (616) 459-4825.

Connect with Other CRE

Professionals by Joining CREW West Michigan

Are you looking to connect with other commercial real estate professionals? Then you will want to learn more about the West Michigan Chapter of CREW! The CREW West Michigan Chapter is the 75^th Chapter of CREW Network. It was founded in 2018 and has been growing in membership size and scope of events ever since. CREW stands for Commercial Real Estate Women, but that doesn't mean you have to be a woman to join. This new and growing chapter has both male and female members from all over West Michigan, and it is a great place to learn and interact with others. Currently, members represent commercial real estate sales, finance, title organizations, property management, and many more. 

Three of GLCF's team members are also involved in the local chapter.  Julie Parker serves as Chapter Treasurer, Kyle Wilson is a newly appointed member, and Lexi Woods is also a member and serves on the Events Committee. Additionally, Bradd Pierce and Nik Hoezee recently played with Julie and Kyle in the CREW WM Golf Outing.  To learn more about CREW West Michigan and how you can join or attend an event as a member or a guest, please visit www.crewwm.org.