Rates
SBA 504 loan rates
As of July 9, 2026, the fixed SBA 504 debenture rate is 6.2% on the 20-year term and 6.172% on the 25-year. That is the CDC/SBA portion only; your blended rate also depends on the separately negotiated bank first mortgage.
Effective rates for July 2026, cross-validated across 3 CDC rate republishers (ThinkSBA, cdcloans, Alloy); confidence: high. Current through August 13, 2026, when the next monthly debenture prices.
The 504 rate is really two rates
An SBA 504 loan funds a project, typically owner-occupied commercial real estate or heavy equipment, in three parts. A bank lends the first mortgage, a Certified Development Company (CDC) lends the SBA-backed second through a fixed-rate debenture, and you put down the rest. Only the debenture rate is the quoted, fixed 504 rate; the bank's rate is negotiated separately, so your real cost is a blend of the two.
| Piece of the project | Share | Rate |
|---|---|---|
| Bank first mortgage | ~50% | Negotiated with the bank (often prime + 1 to 2.75), own term |
| CDC / SBA debenture | ~40% | Fixed 6.2% (20yr) / 6.172% (25yr) |
| Your down payment | ~10% | 15% for a startup or special-use property; 20% if both |
How the debenture rate is set
The debenture is a bond the SBA guarantees and sells to investors once a month. Its rate is priced off the yield on 10-year U.S. Treasury notes plus a market spread, then locked for the full 20-year or 25-year term. Because it follows Treasury yields rather than the prime rate, the 504 rate moves on its own schedule, and it does not reset after closing the way a variable 7(a) rate can. The effective rate quoted above already folds in the ongoing CDC, SBA, and central servicing agent fees, so it is close to the all-in cost of the SBA portion.
What that blends to: an example
On a $1,000,000 project financed 50/40/10, the bank's $500,000 first mortgage at an illustrative 8.25% and the CDC debenture's $400,000 at 6.2% blend to about 7.34% across the $900,000 you finance. The bank rate here is an assumption to show the math, not a quote; your blended cost falls as you negotiate the bank portion down. Run your own numbers with the 504 calculator.
SBA 504 fees (fiscal year 2026)
The fees below are set by the SBA for loans approved between October 1, 2025 and September 30, 2026. The ongoing fees are already reflected in the effective debenture rate above; the upfront fees and closing costs are typically financed into the loan rather than paid out of pocket.
| Fee | FY2026 rate |
|---|---|
| SBA upfront guaranty fee (on the debenture) | 0.50% |
| SBA annual service fee (on the balance) | 0.209% |
| CDC processing fee (one time, financed) | up to 1.50% |
| Manufacturers, NAICS 31 to 33 | 0% upfront and annual |
Manufacturing projects (primary NAICS code in sectors 31, 32, or 33) pay no upfront guaranty fee and no annual service fee in FY2026, which lowers their effective rate by roughly a quarter point against a standard project.
Frequently asked questions
What is the SBA 504 loan rate today?
The fixed CDC/SBA debenture rate is 6.2% for a 20-year term and 6.172% for a 25-year term, effective July 9, 2026. It is reset each month when the debenture bonds are sold, so confirm the current month's pricing with a CDC before relying on it for a live deal. Your overall rate also blends in the bank first-mortgage portion, which is negotiated separately.
Is the SBA 504 rate fixed or variable?
The CDC/SBA debenture portion is a fixed rate, locked for the full 20-year or 25-year term when the bond sells. The bank first-mortgage portion (roughly half the project) has its own rate and term, which may be fixed or variable and is negotiated with the bank. So a 504 is part fixed, part negotiated.
How is the SBA 504 debenture rate set?
The debenture is priced off the yield on 10-year U.S. Treasury notes plus a market spread, set at the monthly bond sale. The rate you see quoted is the effective rate, which already bundles in the ongoing CDC, SBA, and central servicing agent fees. Because it tracks Treasury yields, it moves month to month rather than on the prime-rate schedule that governs 7(a) loans.
What are the fees on an SBA 504 loan?
For fiscal year 2026 (loans approved October 1, 2025 through September 30, 2026), the SBA charges a 0.50% upfront guaranty fee on the debenture and a 0.209% annual service fee on the outstanding balance. A one-time CDC processing fee (up to 1.5% of the debenture) and closing costs are typically financed into the loan. Manufacturers with a primary NAICS code in sectors 31 to 33 pay 0% in upfront and annual fees in FY2026.
What is the down payment on an SBA 504 loan?
Most 504 projects are financed 50% by a bank, 40% by the CDC/SBA debenture, and 10% by the borrower. The borrower share rises to 15% for a startup (under two years) or a special-purpose property, and 20% when both apply, so a new business buying a special-use building can owe 20% down.
How is the SBA 504 rate different from the 7(a) rate?
A 7(a) loan is usually priced as the prime rate plus a lender spread and is often variable. The 504 debenture is a fixed rate tied to Treasury yields and set at a monthly bond sale, and only applies to the CDC/SBA portion. For owner-occupied real estate and heavy equipment, the 504 often delivers a lower long-term fixed rate; the 7(a) is more flexible on use of proceeds.
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