Welcome to our in-depth exploration of the current SBA 504 Rates for June 2025! As a business ownership coach with over 20 years of experience in lending, I’m here to break down the latest trends in SBA financing and how they can benefit you in today’s market. With interest rates slightly down, now is a great time to consider transitioning from renting to owning a commercial property. This guide will cover everything you need to know about the SBA 504 and 7(a) loan programs, the advantages of owning property, and much more.

The Current State of SBA 504 Rates

As of June 2025, the SBA 504 Rate stands at 6.37%, a slight decrease from 6.393% last month. Refinance rates are currently at 6.40% for a 25-year term. This decline in rates presents a fantastic opportunity for business owners and entrepreneurs looking to secure financing for property ownership.

Why Owning Property Makes Sense

Many individuals are currently considering the transition from leasing to owning a property. This is a smart move, especially given the current market conditions. Here are several key advantages of owning a commercial property:

• Ownership: By owning the building, you gain full control over your space.
• Leasing Opportunities: You can lease out any unused space, provided you occupy at least 51% of the property. For new constructions, a 60% occupancy is required.
• Appreciation: Owning real estate allows you to benefit from property appreciation over time.
• Equity Build-Up: As you pay down your loan, you're increasing your equity, which can be leveraged for future investments.
• Tax Advantages: Property ownership comes with various tax benefits that can significantly reduce your overall tax liability.

Evaluating Your Financing Options

When considering a switch from leasing to ownership, evaluating the best financing options is crucial. The two primary SBA loan programs to consider are the SBA 504 and the SBA 7(a) loans. Each has its own set of benefits:

SBA 504 Loans

The SBA 504 loan is designed for purchasing fixed assets and is ideal for businesses looking to acquire or improve real estate. Here’s a quick comparison of its features:

• Financing: Provides up to 90% financing.
• Long-Term Rates: Fixed rates for 25 years.
• Prepayment Penalties: Limited prepayment penalties.

SBA 7(a) Loans

The SBA 7(a) loan is more flexible and can be used for various business purposes, including working capital and equipment purchases. Here’s what you need to know:

• Financing: Offers up to 100% financing for eligible businesses.
• Variable Rates: Rates are based on prime plus a margin.
• Special Offers: Some bank partners provide fixed-rate options for 3 or 5 years.
• Declining Prepayment Penalty: Only a three-year declining prepayment penalty.

Getting Pre-Qualified for SBA Financing

If you are considering a lease replacement deal or simply want to explore your SBA financing options, getting pre-qualified is a vital step. We can help you navigate through the various government-backed financing products, including the SBA and USDA loans, as well as state guarantee programs.

Not only do we facilitate your financing needs, but we can also assist in business acquisitions. Our team is equipped to help you find and fund your ideal business opportunity.

Upcoming Events and Resources

As you think about your business ownership journey, remember that education is key. I encourage you to participate in our upcoming free business ownership events. These events are designed to empower you with knowledge about leveraging SBA financing, tax strategies, and the importance of business ownership.

To learn more and register for our events, visit beaueckstein.com/events. We bring in CPAs and experts who will share valuable insights on why everyone should consider owning a small business.

Conclusion

In conclusion, the slight dip in SBA 504 Rates presents a timely opportunity for business owners to transition from renting to owning commercial property. With various financing options available, including the SBA 504 and 7(a) loans, it’s essential to evaluate what best fits your business needs. Whether you’re looking to buy, expand, or acquire a business, we’re here to support you every step of the way.

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