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Rate of Interest: The interest rate on the SBA portion will be fixed for
the term of the loan and is determined approximately by the current rate
on the 10-year treasury rate plus approximate 300 basis points. Interest
rates are fixed and established at the SBA 504 loan at the SBA FUNDING.
The rate (inclusive of all servicing fees) to the borrowing business concern
is usually 2.75% over five or ten year treasury notes and is typically .5%
to 1% under market rates. Here are the Current Rates. The rate is
determined by the bond market at the sale of government guaranteed
securities. In addition approximately .7% in servicing fees for the SBA
504 portion.
Participating first mortgage lenders are allowed to charge market rates
which may be fixed or variable.
Fees: The fees listed below are based on SBA portion of the loan and are
financed with the loan.
Preferred's Processing Fee: Up to 1.5% of the SBA 504 portion.
Participation Fee: One time .5% fee to the SBA on lender’s participation
usually paid by the primary lender.
Other Program Fees:
• .25% Funding Fee.
• .5% (compounded) Underwriting Fee.
• SBA one time Loss Reserve of .5%.
• 1.25% closing cost allowance.
• The Borrower is responsible for title insurance,
and fees for surveying, engineering, appraisals,
environmental audits, architectural, legal,
accounting and construction period interest.
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