SBA 504 Loans
SBA 504 Loan Rates
Standard 504 debenture rates for November 2026: 6.57% (25-year), 6.58% (20-year), 6.58% (10-year). How a 504 loan is priced, the current published debenture rates with their source and date, the fees, and what the monthly payment looks like for a practice buying its building.
What are current SBA 504 loan rates?
As of the November 5, 2026 debenture sale, the standard SBA 504 effective rate is 6.57% for 25-year loans and 6.58% for 20- and 10-year loans, per CDC SomerCor. That fixed rate covers the CDC portion, about 40% of a typical project. The bank's first-lien portion, about 50%, is priced separately by the bank.
How is an SBA 504 loan priced?
A 504 project is financed in three pieces, and each is priced differently. Under 13 CFR Part 120, the bank's loans must total at least as much as the 504 loan, and the borrower contributes at least 10 percent in the standard case. That produces the familiar split:
- Bank first lien, about 50%. A conventional loan from a bank or other lender, secured by a first lien on the property. The bank sets its rate, term and whether the rate is fixed or adjustable.
- CDC debenture, about 40%. The Certified Development Company portion, funded by an SBA-guaranteed debenture and usually secured by a second lien. Per SBA.gov, its fixed rate is pegged to an increment above the 10-year U.S. Treasury. Debentures are priced at a monthly sale, so the rate moves month to month.
- Borrower contribution, about 10%. Your down payment. It rises to 15% for a business operating two years or less or a limited or single-purpose building, and to 20% when both apply, with the bank share then at least 50% of project cost.
The rate you see quoted as "the 504 rate" is the effective rate on the CDC piece only. A blended cost for your project depends on the bank's offer for the larger first-lien piece, which is why two 504 deals funded in the same month can cost different amounts.
Current SBA 504 debenture rates (November 2026)
The table below reproduces the effective rates SomerCor, an SBA Certified Development Company, published for the debenture pricing completed on November 5, 2026. Commercial Capital, another CDC, published the same standard figures and states that its effective rates "include fees to CDC, SBA, and central servicing agent based on debenture pricing published by NADCO."
| 25-year | 20-year | 10-year | |
|---|---|---|---|
| Standard (purchase and construction) | 6.57% | 6.58% | 6.58% |
| Manufacturing, food supply chain and rural | 6.34% | 6.33% | 6.29% |
| Refinance | 6.58% | 6.58% | 6.58% |
Sources: SomerCor — November 2026 SBA 504 Interest Rates (read 12 November 2026); Commercial Capital — SBA 504 Rates (read 12 November 2026). SomerCor attributes the lower manufacturing, food supply chain and rural rates to the fiscal-year 2027 waiver of the upfront guaranty and annual service fees for those projects. This table is updated monthly; rates published for later sales replace it.
Your rate is set when your debenture is sold
A published rate is the result of one past sale, not a quote. Your CDC portion takes the rate from the sale in which your own debenture is funded, and the bank prices its piece on its own terms. Ask the CDC which sale your loan is expected to fund in, and ask the bank for its rate, term and rate type in writing.
What fees are built into a 504 loan?
The fees a borrower can be charged on the CDC portion are set by 13 CFR 120.971:
- CDC processing fee of up to 1.5% of net debenture proceeds, which can be financed from the debenture.
- A CDC closing fee covering legal and other closing costs.
- A monthly CDC servicing fee of at least 0.625% and no more than 2% a year on the unpaid balance (above 1%, or 1.5% in a rural area, needs SBA approval).
- An SBA guarantee fee of 0.5% of the debenture and an SBA annual fee of up to 0.9375% on the unpaid balance.
- A funding fee of up to 0.25% of the debenture, plus central servicing agent fees.
The ongoing fees are why CDCs publish an "effective" rate rather than the bare debenture rate. The bank portion carries whatever origination, appraisal and legal fees the bank charges, which the regulation does not set; ask for them up front so you can compare offers on the same basis.
Worked example: a practice buying its building
Illustrative only. A dental or medical practice that has operated for more than two years buys the building it occupies for a total project cost of $1,500,000. The building is assumed not to be special purpose, so the standard 10% contribution applies. The CDC rate is the sourced November 2026 25-year standard effective rate (6.57%). The bank rate of 7.00% fixed over a 25-year amortization is an assumption for the example, not a quote: bank pricing varies by lender, borrower and term.
| Share | Amount | Rate and term | Monthly payment | |
|---|---|---|---|---|
| Bank first lien | 50% | $750,000 | 7.00% (assumed), 25 years | $5,300.84 |
| CDC debenture | 40% | $600,000 | 6.57% effective, 25 years | $4,077.53 |
| Practice down payment | 10% | $150,000 | Paid at closing | None |
| Total | 100% | $1,500,000 | $9,378.37 |
The math, using the standard amortization formula payment = P × r ÷ (1 − (1 + r)^−n):
- CDC: P = $600,000, r = 6.57% ÷ 12 = 0.5475% a month, n = 300 months. (1.005475)^−300 ≈ 0.19436, so payment = $600,000 × 0.005475 ÷ 0.80564 ≈ $4,077.53.
- Bank: P = $750,000, r = 7.00% ÷ 12 ≈ 0.5833% a month, n = 300 months, payment ≈ $5,300.84.
- Combined debt service ≈ $9,378.37 a month, or about $112,540 a year.
Two things move the real numbers. Fees such as the CDC processing fee can be financed from the debenture, in which case the CDC balance ends up somewhat above 40% of cost. And many bank first liens carry a shorter term or a rate that adjusts, which changes the bank payment. Compare the annual debt service against the practice's current rent and cash flow; that comparison, not the headline rate, is what lenders underwrite.
Where the 504 fits for dental and medical practices
A 504 is built for a practice buying or building the premises it occupies, or financing long-life equipment. SBA.gov states it does not fund working capital or inventory, so when a deal also needs those, compare a 7(a) or conventional loan. For the full program rules, including owner-occupancy and size tests, see the SBA 504 loan guide. For practice-specific options, see dental practice loans and medical practice loans.
Ovesture helps practices prepare the file lenders and CDCs review and compare a 504 structure with bank financing on the same project budget. Eligibility, rates and terms are set by the lender, the CDC and SBA. Tell us about your building.
SBA 504 rate questions
For the debenture sale completed on November 5, 2026, CDC SomerCor published standard effective rates of 6.57% for 25-year terms, 6.58% for 20-year terms and 6.58% for 10-year terms. That rate applies to the CDC portion of the project only. The bank's first-lien loan is priced separately, and the rate a borrower receives is set by the sale in which their own debenture is funded, so confirm it with the CDC.
The CDC portion is fixed. SBA.gov describes the 504 program as long-term, fixed-rate financing, with the rate pegged to an increment above the 10-year U.S. Treasury. The bank's first-lien portion is a separate loan with its own terms, which can be fixed, adjustable or variable depending on the lender, so compare that part of each offer carefully.
CDC debentures are priced at a monthly sale, and the pricing from that sale sets the debenture rate for loans funded in it. CDCs then publish an effective rate that, per Commercial Capital, includes the fees paid to the CDC, SBA and the central servicing agent. Because the base moves with Treasury yields, the published rate can change from one month to the next.
13 CFR 120.971 caps the CDC processing fee at 1.5 percent of net debenture proceeds and allows a reasonable closing fee and a monthly CDC servicing fee. SBA charges a 0.5 percent guarantee fee on the debenture plus an annual fee on the unpaid balance, and a funding fee of up to 0.25 percent may apply. The bank portion carries the bank's own fees, which the regulation does not set.
Under 13 CFR 120.910 the borrower contribution is at least 10 percent of project cost in most cases, at least 15 percent if the business has operated for two years or less or the building is limited or single purpose, and at least 20 percent if both apply. Whether a particular dental or medical building counts as special purpose is a lender and CDC determination.
Practice & firm funding
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