The National Association of Development Companies (NADCO), the trade association for more than 260 of the nation's Certified Development Companies (CDCs), this week is highlighting the ongoing importance of SBA 504 loans to the nation's economic recovery. CDCs are certified by the U.S. Small Business Administration (SBA) to provide financing to businesses through the SBA 504 loan program. Our industry recognizes two members who were honored during SBA's National Small Business Week for their efforts in helping finance business expansion.
SBA Administrator Karen Mills recognized two CDCs for their outstanding economic development efforts in their communities. HEDCO of Honolulu, Hawaii, was honored as the Large Certified Development Company of the year with a record 54 projects for $24.5 million in SBA-guaranteed second mortgages. Monroe County Industrial Development Corporation (MCIDC) of Rochester, New York delivered 24 SBA 504 loans, funding $16 million in SBA-guaranteed second mortgages to local small businesses.
Chris Crawford, president of NADCO, congratulated both CDC winners noting, "We are very proud of the contributions that HEDCO and MCIDC have made through hard work dedicated to their communities. Small businesses form the backbone of our nation's economy and are responsible for creating and sustaining millions of jobs. We're very proud of our member CDCs and their impact on small businesses whose growth is leading to more jobs across America."
The CDC industry has financed more than $45 billion in SBA-guaranteed owner-occupied commercial real estate and equipment loans to America's small businesses. Our commercial banking partner lenders have provided another $70 billion in small business first mortgages, resulting in over $110 billion in total 504 project authorized or funded since 1986.
Through the Jobs Act of 2010, 504 loans can also be used to refinance existing qualified small business debt. Businesses can refinance up to 90% of the appraised value of qualified collateral and use any excess equity to obtain working capital for eligible business expenses. SBA estimates that as many as 8,000 businesses may participate in this refinancing program during the current fiscal year, which could provide up to $7.5 billion in SBA-guaranteed refinancing. These SBA-guaranteed loans would lead to total projects of almost $17 billion if all the authorized funds were used.
The National Association of Development Companies (NADCO) is the trade association for the nation's Certified Development Companies (CDCs). Our members are non-profit organizations that serve every state, as well as Puerto Rico and U. S. territories in the South Pacific. CDCs have been certified by the U.S. Small Business Administration (SBA) to provide financing to small businesses through the SBA 504 loan program. For more information, contact at CDC in your area by visiting the NADCO website, www.nadco.org .
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