A First Lien Position 504 Loan is a type of financing provided by a lender that holds the primary lien on a property being financed as part of the Small Business Administration (SBA) 504 loan program. This loan is specifically designed to help small businesses acquire fixed assets, such as real estate or equipment, by providing long-term financing at favorable rates.
The term "First Lien Position 504 Loan" is used in the context of business financing and real estate transactions. It is relevant in areas such as commercial real estate law and business finance. This type of loan is often utilized by small businesses looking to secure funding for property purchases or renovations. Users can manage related forms and procedures through resources like US Legal Forms, which offers templates drafted by experienced attorneys.
Here are a couple of examples of abatement:
Example 1: A small manufacturing company secures a First Lien Position 504 Loan to purchase a new facility, allowing them to expand operations and increase production capacity.
Example 2: A local restaurant uses this type of loan to buy and renovate a building, improving its location and attracting more customers. (hypothetical example)
Examples of state differences (not exhaustive):
| State | Details |
|---|---|
| California | Offers additional incentives for green energy projects through 504 loans. |
| Texas | Has specific regulations regarding the appraisal process for properties financed under this program. |
| New York | May have different local requirements for property inspections and disclosures. |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Description | Difference |
|---|---|---|
| Second Lien Position Loan | A loan secured by a second lien on the property. | First lien loans have priority in repayment over second lien loans. |
| SBA 7(a) Loan | A different type of SBA loan for various business purposes. | 504 loans are specifically for fixed assets, while 7(a) loans can be used for working capital. |
If you are considering a First Lien Position 504 Loan for your business, start by evaluating your financing needs and the assets you wish to acquire. Gather necessary documentation, such as financial statements and business plans. You can explore US Legal Forms for templates that can help you prepare your application and other required documents. If your situation is complex, consulting with a legal or financial advisor may be beneficial.
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It is used to finance the purchase of fixed assets for small businesses.