The new SBA program for 504 loans went into effect on June 24, 2010. Originators are to assemble and sell pools of 504 first mortgage loans to make fixed asset financing more widely available for small businesses.
The new SBA program for 504 loans was approved under the American Recovery and Reinvestment Act. The SBA will provide a government guarantee on pools of portions of eligible 504 mortgage loans assembled by approved pool originators to be sold to third-party investors. Lenders will retain at least 15% of each individual loan, pool originators will assume 5 % of the risk, and the SBA will guarantee the remaining percentage.
