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SBA 504 Loan Process

Jun 24, 2021

Applying for the SBA 504 loan program can be a daunting process, and you may find yourself wondering:

Where do I begin?

How do I apply?

How long will it take?

If you have asked yourself some of these questions, you are not alone. These are some of the most common questions we receive in regard to the SBA 504 financing program. So, what does this process look like?

The entire SBA 504 loan process takes several steps to complete and requires participation between the lender, SBA, CDC (Certified Development Corporation like Dakota Business Lending), and the borrower(s) themselves. The timeline below shows a brief snapshot of what this process looks like and will give you an idea of the major steps involved.

    Contact Dakota Business Lending

    The first step in the SBA 504 loan process is to contact your CDC and your lender. It works best to have all parties on board from the beginning for the process to go as smooth as possible.

    Preliminary Eligibility Review

    Before you start your SBA 504 application, your CDC will help ensure that your project is eligible. To do so, you will need to provide:

    • Basic project overview and estimated costs
    • Information from all owners with 20%+ ownership, including two years of personal tax returns and a current personal financial statement
    • Business information, including:
      • Two years business tax returns
      • Current financial statements
      • Current debt schedule
      • 2 years of financial projections
      • Business plan (if new business)

    Complete and Submit the Application

    After your project is deemed to be eligible, it is time to start your SBA 504 loan application! Your Dakota Business Lending loan officer will provide you with a copy of the application, work with you, and provide you with a missing items checklist or any other corrections you may need to make along the way. You can find a list of items needed for a full application here.


    The next step in the SBA 504 loan process is underwriting. This is when we will actually analyze the information you provided about your business, your property, and other aspects to make sure there are no hidden issues or risks and ensure that we believe you company can support the additional debt you are requesting.

    Loan Review Committee/Submit to SBA

    When the underwriter is done, we will bring the loan to our Loan Review Committee, who will vote whether or not to approval the deal. After it is approved, the loan application will be submitted to the SBA.

    SBA Approval!

    The SBA will then review your application. Sometimes they approve or decline the loan right away, other times they ask questions which require us to submit additional information that takes additional time for review.


    After your project is completed, you will need to provide final required information to prove the use of loan funds, provide insurance coverage, show the current financial state of the business, and any other required information. Once that is received, you will meet with your loan officer to sign all closing documents of the loan.  

    Funding & Rates

    After your loan has been closed, your loan is processed for funding, which usually occurs about 2 months after closing. When that is completed, your final fixed, below-market interest rate will be calculated.


    Congratulations – you have likely accomplished a large milestone for your business! You will then begin your repayment process at whatever term you received a loan for – 10, 20, or 25 years.

    As you can see, the SBA 504 loan process contains many steps and moving parts, but at Dakota Business Lending, we will guide you through the process and keep you updated along the way.

    If you are interested in applying for the SBA 504 loan program and learning more about if it is the right fit for you and your business, contact the loan officer in your area.