504loans@wiki

Environmentals

2012-06-30T06:00:39+09:00

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Steps of an Environmental Investigation (Flowchart)

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Tips to help in the processing of environmental submissions to SLPC

Ensure that the CD is properly labeled.
Ensure the SBA Reliance Letter is not altered or modified.
Send in new documents for resubmissions – not all documents.
Attach the screen-out with the resubmission.
Address the past and current use of the property and the adjoining properties in an Environmental Questionnaire (EQ).
Ensure the EQ is signed by the owner or operator of the property
Ensure the CDC Checklist has comments and is signed by the CDC.
Provide the loan number or the control number on the CDC Checklist.
If a loan is approved after pre-application, include the control number so the documents can be associated with the pre-application file.
If a records search and risk assessment (RSRA) states anything other than a "low risk", a Phase 1 Assessment is the minimum requirement for submission.
Ensure all recommendations by the environmental professional are completed prior to submission to SLPC.
Ensure the addresses on the CDC Checklist and the environmental documents match the address on the loan authorization.
Ensure the correct NAICS code is included on the CDC Checklist.
Ensure the CDC Checklist is included for all environmental document submittals.
Ensure the SBA Reliance Letter has the same date as the Transaction Screen Analysis (TSA), Phase 1 Assessment or Phase 2 Assessment.

Ensure the SBA Reliance Letter and Certificate of Professional Liability Insurance accompanies the TSA, Phase 1 Assessment or Phase 2 Assessment.
The Phase 1 Assessment for a gas station must include a determination whether or not the gas station is in compliance with all state requirements, if any, pertaining to tank and equipment testing.

v Minimum requirements for environmental submissions

If the property is in an environmental sensitive industry as defined in Appendix 4 of SBA SOP 50 10 5, then a Phase 1 Assessment is required.
If the property is not in an environmental sensitive industry as defined in Appendix 4 of SBA SOP 50 10 5 and the loan is less than or equal to $150k, then an Environmental Questionnaire is the minimum requirement for submission.
If the property is not in an environmental sensitive industry as defined in Appendix 4 of SBA SOP 50 10 5 and the loan is greater than $150k, then an Environmental Questionnaire and a Records Search and Risk Assessment are the minimum requirements for submission.
If the owner/operator of the site is unable or unwilling to sign an environmental questionnaire, then a Transaction Screen Analysis is the minimum requirement for submission.

v Environmental References

SBA SOP 50 10 5 (E)

collab.sba.gov/sops/Documents/5010/5010_5e_Clean.pdf

EPA All Appropriate Inquiries (AAI)

www.epa.gov/fedrgstr/EPA-WASTE/2005/November/Day-01/f21455.htm

NAICS Codes

www.census.gov/eos/www/naics/

v Environmental Documents

v General Inquiries

Please submit all general environmental inquiries to the Sacramento 504

Environmental Inbox at Sacramento504environmental@sba.gov

v SLPC Environmental Engineers

Margaret Berry
Robert Gilmore
Brian Longval
Stephen Reynolds

Top 15 Reasons for Appraisal Screenouts

2012-02-01T05:39:50+09:00

The appraisal must identify the CDC and SBA as the client and/or an intended user of the appraisal, as those terms are defined in the Uniform Standards of Professional Appraisal Practice (USPAP). It is acceptable to SBA if the appraisal identifies the Third Party Lender as the client and the CDC and SBA as intended users. The CDC may not use an appraisal prepared for the applicant. Please refer to SOP 50 10 5 (D) pages 312-313

The actual occupancy differs greatly from how the project was submitted.
The report has not been extended to SBA/CDC.
The report was not signed by the appraiser.
The actual purchase price of the property was less than the amount included in the Authorization.
The report was written in the abbreviated “restricted use” format.
The value of the property was less than the purchase price (when the purchase is associated with a change of ownership business purchase).
A “going concern” value was provided, but the value was not broken out into all of the components required by the SOP.
The market value was based on much higher construction costs than those approved by SBA.
Ineligible property was discovered to be a part of the project.
The market value of the property was substantially less than the amount required in the Authorization and was submitted to SLPC without either an acceptable justification from the CDC, or an accompanying 327 change request to provide additional collateral, additional investment, or a reduction in project costs.
The market value was only valid with substantial non-project funding which is not addressed in the Authorization.
The appraisal report indicates that project funds will be utilized to build out the portion of the property that will be occupied by a tenant.
The report was stale dated over twelve months prior to the loan application date.
The appraisal report was submitted to SLPC without the “CDC Checklist for Submitting Real Estate (or Equipment) Appraisal” cover sheet.
The address on the appraisal report does not match the address in the Authorization for which an appraisal report is required and the CDC did not provide a letter of explanation and/or documentation showing that the properties are the same.

Appraisals

2012-02-01T05:35:41+09:00

Note: We have seen a growing trend in appraisals only providing one valuation methodology despite the current state of the economy and typical banking practices. For credit reasons, SLPC generally looks for at least two methods of valuation in an appraisal report. Any deviation should be thoroughly explained and discussed by the appraiser. We are looking for at least two valuation methodologies for credit reasons. We believe we are being consistent with common banking practices, especially in light of the current state of market conditions.

Lists| Top 15 Reasons for an Appraisal Screen Out

The actual occupancy differs greatly from how the project was submitted.
The report has not been extended to SBA/CDC.
The report was not signed by the appraiser.
The actual purchase price of the property was less than the amount included in the Authorization.
The report was written in the abbreviated “restricted use” format.
The value of the property was less than the purchase price (when the purchase is associated with a change of ownership business purchase).
A “going concern” value was provided, but the value was not broken out into all of the components required by the SOP.
The market value was based on much higher construction costs than those approved by SBA.
Ineligible property was discovered to be a part of the project.
The market value of the property was substantially less than the amount required in the Authorization and was submitted to SLPC without either an acceptable justification from the CDC, or an accompanying 327 change request to provide additional collateral, additional investment, or a reduction in project costs.
The market value was only valid with substantial non-project funding which is not addressed in the Authorization.
The appraisal report indicates that project funds will be utilized to build out the portion of the property that will be occupied by a tenant.
The report was stale dated over twelve months prior to the loan application date.
The appraisal report was submitted to SLPC without the “CDC Checklist for Submitting Real Estate (or Equipment) Appraisal” cover sheet.
The address on the appraisal report does not match the address in the Authorization for which an appraisal report is required and the CDC did not provide a letter of explanation and/or documentation showing that the properties are the same.

Welcome to 504Loans@wiki

2011-12-13T09:32:24+09:00

The 504Loans wiki project is a free service for anyone in the 504 community. The goal for this site is to provide a home to all the information about 504 that is floating around out there. -The site is free for anyone to view, those that make an account, can update content -See [[What's New]] -Browse or search the [[Content>Contents]] articles, this is where most of the information can be found -Check out the [[Timeline>Timeline]] and stay abreast of changes to the 504 program Registration is now closed for this wiki site. ***However, for the very latest on the 504 program, we encourage you to check out a new forum [[504um.com>http://www.504um.com]] |&italic(){Quick Links}| |&color(blue)[[JOBS ACT REFINANCING]] program| |&color(blue)Submit your 504 package electronically via the [[e504]] program| |&color(blue)****[[DIRECT LINK TO THE ELECTRONIC CREDIT MEMO****>>http://www1.atwiki.com/504loans?cmd=upload&act=open&pageid=59&file=credit+memo+project+ver+3.0.xls]]| |&color(blue)Get an [[ETRAN]] SERVICING account| |&color(blue)Want to reduce your screen out rate? [[Top 10 Reasons for Screenouts]] have been added to our [[Lists]] section| |&color(blue)Check out an easy to use [[Refinancing Worksheet in Excel Format -Ver 2 uploaded 9/24/09>Refinancing]]| |[[more>http://www1.atwiki.com/504loans/pages/7.html]]| To report a bug, questionable content, graffiti or if you have any questions about the wiki site email 504loanswiki@gmail.com ****Disclaimer: This website is not sponsored by or affiliated with the US Small Business Administration (SBA). This website is intended for educational purposes only. The structure of the 504loans@wiki project allows for any member to alter its content. Although, you may find this information valuable, there is no guarantee of the validity of the information found here. ---- &color(white){Number of Visits since April 2009: &counter (total)} &color(white){Number of Visits Today: &counter (today)}

Q & A (post here)

2011-12-13T09:18:52+09:00

This page is now locked.

However, find the answers to the questions everyone is asking, check out a new forum 504um.com

Best of Q & A

2011-12-13T09:18:20+09:00

This page is now locked.

However, find the answers to the questions everyone is asking, check out a new forum 504um.com

Best of Q & A (ARCHIVE)

Q1:How does SBA define a Minority?
A1: See CFR 124.103(b) for the definition prescribed by the SOP. That definition is:

Black Americans;
Hispanic Americans;
Native Americans (American Indians, Eskimos, Aleuts, or Native Hawaiians);
Asian Pacific Americans (persons with origins from Burma, Thailand, Malaysia, Indonesia, Singapore, Brunei, Japan, China (including Hong Kong), Taiwan, Laos, Cambodia (Kampuchea), Vietnam, Korea, The Philippines, U.S. Trust Territory of the Pacific Islands (Republic of Palau), Republic of the Marshall Islands, Federated States of Micronesia, the Commonwealth of the Northern Mariana Islands, Guam, Samoa, Macao, Fiji, Tonga, Kiribati, Tuvalu, or Nauru);
Subcontinent Asian Americans (persons with origins from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the Maldives Islands or Nepal)

Comments:
The Public Policy Goal of Minority-Owned only applies to U.S. Citizens.

The Operating Company must be at least 51% owned by a Minority.

Q2:Will a bank letter (EX. 19) with an electronic signature work?
A2: Yes.

Q3: Does a ScoreEdge504 report count as a "Business Credit Report" and satisfy the requirements under Exhibit 22?
A3: I have been told by the SBA that it does not. The business credit report should be from D & B, Equifax, Experian, TransUnion or a similar provider.

Q4: We currently have a new construction project moving into an Enterprise Zone. The business is a medical practice, which we believe meets a community development policy goal according to 13 CFR 120.862; would that, alone, make this project 504 eligible without creating/retaining any jobs......

A4:Enterprise Zone can be a goal.

Q5: When dealing with co-OCs, the SOP gives guidance for determining which NAICS code to use by whichever OC has the highest revenue. With that said, if the two OCs are sole proprieterships (each 100% owned by a single person) are we bound by revenue or can occupancy be used as an alternative method of determining which NAICS code to use? which would determine minority status for an SBA 504 loan

A5. The NAICS code to use for the application should be the NAICS code for the primary industry of the Project location. The same would apply to the minority status of the application. What the primary industry or the primary Operating Company may be is a judgment call; if it affects the eligiblity or approval of the application, SBA will make that judgment.

Q6: When financing used medical equipment, is an appraisal from a certified equipment appraiser required, or will a valuation from a vendor suffice?

A6. I don't think SBA has a standard policy for this, it might be more of a credit decision to require an Appraisal.

Welcome to the archived Best of Q & A page. This page is locked. If you would like to post or answer a question, visit the Q & A page here.

Q7: What is Third Party Lender Preference?
A1:See CFR definition below:

Sec. 120.925 Preferences.

No Third Party Lender shall establish a Preference.(See Sec. 120.10 for a definition of Preference.)[61 FR 3235, Jan. 31, 1996, as amended at 68 FR 57988, Oct. 7, 2003]

Sec. 120.10

Preference is any arrangement giving a Lender or a CDC a preferredposition compared to SBA relating to the making, servicing, orliquidation of a business loan with respect to such things as repayment,collateral, guarantees, control, maintenance of a compensating balance,purchase of a Certificate of Deposit or acceptance of a separate orcompanion loan, without SBA's consent.

Q8: What does SBA mean when it uses the phrase “date of application,” in
requirement for an applicant’s financial statements to be no older than 90 days
application?

A8: In this instance, when SBA uses the phrase “date of application,” it means
application was received by SBA (not the lender). Thus, an applicant’s financial
be no older than 90 days from the date that SBA receives the application.

Q9: What is required for Exhibit 19 (Bank Letter)?

A9: At a minimum, we are looking for a dated letter of intent from the prospective 3^rdparty lender (on their letterhead) that states conditions of its participation. The following is the minimum information required in this letter:

The Applicant's name.
The dollar amount of the loan,
The percent of the project that the loan is financing (e.g., 50% which could be inferred)
The terms of the loan (e.g., 20 years, interest rate, etc.)
The letter needs to be signed by the 3rd party lender.
Must include the reason why it will not finance the entire project.

Q10:Where can a CDC send back a duplicate fee refund check?
A10: You may return any extra checks with a brief explanation to:

Small Business Administration

Denver Finance Center

Denver, CO 80259

Q11: I have looked everywhere, does anyone have a copy of the FAQ that the SBA released regarding SOP 50 10 (5)?

A11: Here it goes:

SOP 50 10(5) Frequently Asked Questions (Taken from a document produced by the SBA)
Eligibility – Passive Income
1. Q: When the applicant is a mini-warehouse or other type of business that receives passive income,
how does the lender document that at least 50% of the revenue is derived from services provided?
A: The applicant must break down the revenue into the passive income (rental) and income for
services provided. If the applicant is unable to break down the revenue and show that at least 50 %
of its revenue is derived from services provided, then the applicant is not eligible.
2. Q: When the applicant is a mini-warehouse or other type of business that is a start-up, how does
the lender document that at least 50% of the revenue is derived from services provided?
A: The applicant’s projections must break down the revenue into the passive income (rental) and
the income for services to be provided in order to make a determination that the applicant is
eligible.
3. Q: When the applicant does not bill separately for services and has the majority of its revenue as
passive income (rental), how does a lender determine if it is eligible?
A: If expenses associated with providing the services equal at least 50 % of the total revenue
earned by the applicant, then the applicant is eligible. SBA does not consider mortgage payments,
depreciation, etc. as “expenses associated with providing services.”
Eligibility – Limited or Special Use Property
1. Q: Swimming pools are listed as a Limited or Special Purpose Property. If the applicant has a
pool on the property is it a Limited or Special Purpose Property?
A: If the applicant has a pool on the property and is in the business of providing recreation through
the use of a swimming pool, then it is a Limited or Special use Property.
2. Q: Does SBA consider all day care centers to be Limited or Special Purpose Properties?
A: SBA does not consider day care centers to be Limited or Special Purpose Properties. If,
however, the facility is a pre-school as well as a day care center, then it would be a Limited or
Special Purpose Property. It depends on the specific circumstances surrounding that particular
business.
Eligibility – Trade with Foreign Countries
1. Q: How does a Lender or CDC determine if an applicant involved in international trade is doing
business with a country where the U.S. Government has implemented trade restrictions which
would cause the applicant to be ineligible for SBA assistance?
A: The Lender or CDC must review the Export-Import Bank’s Country Limitation Schedule as
explained in the SOP. If the applicant does business with a country that is identified with Note #7,
then the applicant is not eligible for 7(a) or 504 assistance. If the country is identified with any
other code, the applicant is eligible and the application can be processed under any of SBA's
delivery methods.
Eligibility – 504 – Machinery and Equipment
1. Q: Are locomotives, dumpsters, and forklifts eligible for 504 financing?
A: Locomotives are not eligible. In the case of dumpsters and forklifts, if the business should have
one or two associated with the purchase of a building it would be eligible. It would not be eligible
if the request was for someone who is in the business of supplying dumpsters or forklifts as it is not
equipment in a fixed location or meet the definition of heavy duty construction equipment.
Change of Ownership
1. Q: In a change of ownership, if the Lender does not know if the seller has SBA-guaranteed
financing, can the loan be processed using PLP procedures?
A: After the lender has documented its efforts to determine if the seller has SBA-guaranteed
financing, the application can be processed PLP if the seller does not have SBA-guaranteed
financing or the lender was unable to determine if the seller has SBA-guaranteed financing.
2. Q: In a change of ownership, the SOP mentions the lender should explore seller financing for
intangibles. If the seller is unwilling to finance all or a portion of the intangibles, what is the
Lender’s documentation responsibility?
A: The lender should document its efforts to obtain seller financing. The documentation should
include a copy of a letter or email to the seller along with a copy of the seller’s response or a
specific notation that a response was not received within 15 business days. In addition, attempts at
telephonic communication should also be documented.
3. Q: In the 504 program, is a “change of ownership” considered a “new business?”
A: Yes, SBA considers a change of ownership to be a “new” business because it will result in new,
unproven ownership/management and increased debt unrelated to business operations.
Personal Guaranties
1. Q: If a borrower is going to use a 401(k) to own all or a portion of a business, is the 401(k)
required to guarantee all or a portion of the loan?
A: No. Under the provisions of the new SOP, the 401(k) does not have to guarantee the loan;
however, the Employee Participant (owner(s) of the Qualified Retirement Account, the new 401(k)
that owns a portion of the business) must provide a full, unconditional personal guaranty. In
addition, the Lender or CDC must ensure that the 401(k) plan meets the applicable IRS eligibility
requirements.
Refinancing
1. Q: If the loan will be refinancing a business acquisition, what is the maximum maturity?
A: The maturity of the SBA-guaranteed loan will be based on the remaining useful life of the
business collateral being pledged to secure the loan.
2. Q: Is interest-only financing considered unreasonable and, therefore, eligible to be refinanced with
an SBA-guaranteed loan?
A: Interest-only term debts are considered unreasonable. A short term, interest only line of credit
is not considered unreasonable because this is a standard means of financing short term working
capital needs.
3. Q: Does the 20% cash flow improvement rule apply to short term lines of credit?
A: No.
4. Q: Do all of the tests associated with debt refinancing for SBA Express apply to Patriot Express
and the Pilot Loan Programs?
A: Yes. Questions regarding debt refinancing are on the Eligibility Checklist covering all these
programs.
912 Issues
1. Q: If a borrower had prior offenses and the application previously was cleared for processing by
SBA, will this applicant have to be cleared for those offenses again?
A: Yes, the applicant must complete a new 912 in connection with the new application. The 912
must go through the appropriate clearance process.
2. Q: If the applicant has a criminal record which has been expunged, how should the applicant
answer the questions on SBA Form 912?
A: Although the record may have been expunged, in many cases the arrest record still exists so the
applicant must answer “yes” to the question asking if he/she has ever been arrested. The applicant
can explain that the record related to the arrest has been expunged. The lender will need to submit
the completed 912 package for the required name check/character determination.
3. Q: If there is no paperwork to show the charges were dropped without prosecution, what can the
borrower/Lender/CDC do?
A: If there is no paperwork from the court or prosecutor’s office to support the claim that the
charge was dropped without prosecution, the complete 912 package must be submitted for a name
check/character determination.
INS/USCIS Verification
1. Q: When making a second loan to a borrower that received a loan, is a new verification of alien
status required?
A: If the verification is for a Lawful Permanent Resident, verification is required if 6 months has
elapsed since the last verification with one exception: If the individual reported an offense on SBA
Form 912, then verification would be required even if 6 months had not elapsed, as the offense
may put their status at risk. For non-Lawful Permanent Residents, verification is required with
each request, as their status can be revoked at any time.
Collateral
1. Q: Under 7(a), does a Lender have to take all available collateral, even if the value may be
considered negligible?
A: For 7(a) loans other than SBA Express and the Pilot Loan Programs, the Lender must take
security interests in all available assets with a combined “liquidation value” up to the loan amount.
For SBA Express and the Pilot Loan Programs, the Lender uses the same collateral policies it has
for its non-SBA loans with one exception: For Patriot Express loans of $350,000 or more, the
Lender must take all available collateral.
Appraisals
1. Q: When the collateral will be new construction or involve substantial renovation of an existing
building, can a Certificate of Occupancy or Lender/CDC’s site visit meet the requirement for a
post-construction certification by an appraiser?
A: No, the appraiser will know the rationale for the “as-built” value of the structure and is the
person in the best position to determine if the value of the structure needs to be adjusted as a result
of any deviations from the original plans and specifications.
2. Q: When the collateral will be new construction or involve substantial renovation of an existing
building, the appraisal must estimate what the market value will be at completion of construction.
After construction is completed, the lender must obtain a certification from the appraiser that
construction was completed according to plans and specifications. What is SBA requiring the
appraiser to certify to?
A: SBA is requiring that the appraiser review the project after construction has been completed to
determine whether the finished project still meets the original appraised value or if the appraisal
needs to be adjusted to reflect substantial changes in the final project from the original plans and
specifications. Changes in market conditions that may have occurred during the construction
period are not to be reflected in the final determination of appraised value.
3. Q: If the valuation of fixed assets is greater than their depreciated value, an independent appraisal
must be obtained to support the higher valuation according to the SOP. Does this apply to SBA
Express?
A: No. The SOP describes the SBA Express collateral policy separately and should be read to
include the Lender’s appraisal policy.
4. Q: In 7(a), SBA requires a real estate appraisal if the SBA-guaranteed loan is greater than
$250,000 and is secured by commercial real property. Would an appraisal be required in the
situation where the lender has taken an “abundance of caution” lien on real estate and given no
value to it?
A: Yes, if it is commercial property. The Small Business Act requires an appraisal on any
commercial real property that secures a 7(a) loan that is over $250,000.
5. Q: For 504, when land for the project property is contributed as all or part of the borrower’s
contribution, when is an appraisal required?
A: It is required at the time of application to determine if the required borrower’s contribution has
been satisfied. If it has not been satisfied, additional cash or land (which will be part of the project
property) must be injected. The borrower’s contribution must be satisfied for the 504 application
to be eligible.
Business Valuation
1. Q: Can Lenders use third party software to constitute an independent business valuation?
A: No, because the lender inputs the data into the software program it is not an independent, third
party valuation.
Financial Statement/Documentation Requirements
1. Q: What does SBA mean when it uses the phrase “date of application,” in connection with the
requirement for an applicant’s financial statements to be no older than 90 days from the date of
application?
A: In this instance, when SBA uses the phrase “date of application,” it means the date the
application was received by SBA (not the lender). Thus, an applicant’s financial statements must
be no older than 90 days from the date that SBA receives the application.
2. Q: What documentation must the lender have in its file to satisfy SBA requirements concerning
the verification of an applicant’s tax returns when the IRS transcript reflects “Record Not Found”
for one of the three years requested? For example, the lender requests transcripts for 2002, 2003
and 2004 and the 2003 transcript shows “Record Not Found.”
A: If the IRS has record of the returns filed in the previous and subsequent years, the Lender has
verified these tax returns, AND the borrower has some record of either receiving a refund or
paying the taxes for the missing year, then the Lender may reasonably assume that the borrower
filed a return for the missing year. Additionally, having the borrower take a copy of the missing
return to the local IRS office and having the office acknowledge receiving it is further evidence
that the IRS has received the return. If the Lender documents all of these steps in its loan file, the
lender would be able to show to SBA that it made good faith efforts to satisfy the verification
requirement.
Maximum Maturity
1. Q: What does SBA consider as the maximum term for financing intangibles?
A: 10 years.
Insurance
1. Q: The SOP requires Lenders and CDCs to include in the Authorization any other insurance
appropriate to the loan and includes a list of other types of insurance. Are the insurance types
listed required?
A: The Lender/CDC has the discretion to determine what other insurance should be required.
PLP Processing
1. Q: Can applications involving medical facilities or farms be processed under PLP procedures?
A: Yes, the prohibitions against PLP processing for certain types of businesses have been
removed.
2. Q: Has the requirement for a 10% equity injection for new businesses, change of ownerships or the
purchase of real estate been removed as a requirement for such applications to be processed under
PLP?
A: Yes.
Disbursement
1. Q: Does the 48-month disbursement period limit apply to all 7(a) and 504 loan programs, including
SBA Express and the Pilot Loan Programs?
A: Yes. If you reach the 48 month period and the loan is not fully disbursed, the loan must be
disbursed or any remaining balance canceled. If the loan is not disbursed at all, a new application
can be processed with updated financial information. With revolving lines of credit, SBA views
the loan as being fully disbursed with the initial disbursement.
2. Q: After the borrower signs the SBA Form 1050 at initial disbursement, is the Lender required to
continue to list all subsequent disbursements on the Form 1050?
A: No. Each disbursement must be documented, but there is no need to go back and add all the
disbursements onto the Form 1050. The form is only required at time of first disbursement.
Lender Fees
1. Q: Can a lender charge a borrower a prepayment penalty?
A: No, Agency regulations at 13 CFR 120.221(e) specifically prohibit lenders from charging
prepayment penalties on SBA-guaranteed loans.
Program Guides
1. Q: Will the program guides be updated?
A: No, when SBA updates SOP 50 50 and SOP 50 51, the appropriate sections from the program
guides will be incorporated into each SOP and then the program guides will be eliminated.
CDC Organization Requirements
1. Q: If a CDC has in its by-laws that less than 51% of the membership constitutes a quorum, does
the CDC have to change its by-laws?
A: Yes, the by-laws should be changed at the earliest opportunity and must be changed prior to the
next CDC status renewal or review.

Here is a copy in PDF Format:ATTACHMENT - FAQ on SOP 50-10(5) - Produced by SBA

Navigation

2011-09-16T03:43:45+09:00

e504

2011-09-16T03:31:36+09:00

e504 (for ASM submissions only)

What is e504?
When can I submit my application electronically? Coming Soon!
Check out the e504 Quick Start Guide

Electronic Credit Memo 3.0 for e504

To download current data elements (Electronic Credit Memo 3.0) click here.

Several important changes have been incorporated into v3.0 of the credit memo. While we continue to focus on the content (the data elements themselves) of the credit memo, it is now apparent that there will be an interim period before full xml data transfer of the credit memo contents is active. It is therefore important that the credit memo has a reasonable “readability” factor – that it flows smoothly. We have re-designed the credit memo to provide a much smoother flow in that regard.

As a reminder, this credit memo is not a form. To help emphasize this, the various worksheets in the Excel file no longer have titles. They should not be thought of as “pages” – rather they should be considered as a way to communicate the required data elements. This credit memo is really just a collection of various sections in a series. These various sections have been placed in a different order than prior versions in an effort to improve the readability and flow of the information when provided in a printed format as CDCs currently provide. Variation in the section order (as well variation in the presentation of the various elements of each section) is acceptable as along as the data elements ultimately provided are the same as the ones we need.

The size of the various comment boxes should not in any way be interpreted as representative of the desired length of the comment to be received from the CDC. At this time we do not have any specs for these items. To the extent that you can program variable-size comment boxes to avoid “overflow” comments will be appreciated and improve readability.

Donated land equity

2011-05-12T03:47:12+09:00

I have a potential SBA-504 borrower that was recently awarded a piece of undeveloped land in an RFP that they will be developing (development cost estimate at $4,000,000). The City is willing to transfer title to the borrower at a cost of $1.00 or transfer the title & secure the deed with some form of foregiveable debt/note at some specified dollar amount (say $1,500,000). The borrower would also like to use this land equity as their injection. The value of the land is estimated at $1,500,000. I realize that if the land is sold for $1.00, the eligible SBA-504 land cost would be $1.00 and the calculation for financing would also be based on this cost. Would SBA have any issue in using the land equity at $1,500,000if it was sold to the O/C for $1,500,000 and the City carried some form of forgiveable debt over the next 10 or 20 years?

Jobs Act REFINANCING

2011-03-10T03:55:34+09:00

SMALL BUSINESS JOBS ACT REFINANCING

On September 27, 2010, the Small Business Jobs Act of 2010 was signed into law. The temporary Jobs Act Program authorizes the refinancing of debt where there is no expansion of the small business. The authority is for two years only, and is available for loan applications approved by SBA through September 27, 2012. The Sacramento Loan Processing Center began accepting applications effective Monday, February 28, 2011. Below are the links to the NADCO Power Point Presentation and the SBA Policy Notice detailing the refinance program.

NADCO's RefiPowerPoint

SBA Policy Notice 5000-1197 Jobs Act Refinance

Frequently Asked Questions