New SBA Rules that Allow SBA 504 Financing for Business Expenses Could Double Loan Volume at Mercantile Capital Corporation

ALTAMONTE SPRINGS, Fla. --- Mercantile Capital Corporation, which already ranks as one of the largest providers of U.S. Small Business Administration (SBA) 504 financing for small business owners who want to acquire or develop their own facilities, could see its loan volume double thanks to new SBA rules that allow SBA 504 financing to refinance current conventionally-financed loans and provide working capital.

“I don’t have to tell you how big a deal this is for a vast number of small business owners,” said Christopher G. Hurn, co-founder and chief executive officer of Mercantile Capital Corporation. “This is what some people might call a ‘game changer.’”

Hurn, who has actively advocated for these SBA changes for nearly eight years, said the new lending rules should have a major impact on small business growth and development.

“When thousands of small business owners across this nation are struggling with high interest rates on loans for commercial buildings and an inability to finance additional working capital, this is phenomenal,” Hurn said.

SBA 504 loans offer qualified small business owners below-market interest rates and up to 90 percent financing, considerably better terms than offered by commercial banks. Additionally, the SBA 504 loan program is considered a “zero-subsidy” government program whereby borrower fees “insure” the government guarantee on a portion of the loans.

Legislation enabling the new rules was part of the Obama Administration’s Small Business Jobs and Credit Act passed in late 2010, but the SBA only promulgated rules allowing financing of legitimate business expenses this week, Hurn said.