Holiday Inn Express
in Lake Worth, Texas
Mr. Patel has previously financed other properties with Martin Talley of Texas Bank, using conventional loan products. Typically, a conventional loan will require a 25% to 30% down payment. This project involved new construction of a 69 room Holiday Inn Express. As a brand new property, projected revenue would be less available in the early months and the need for working capital would be greater. Therefore, Mr. Patel was pleased to be using the 504 loan product as recommended by Mr. Talley.
The SBA 504 loan required an equity injection of only 20%. With the money saved on equity injection; Patel was able to fund his own working capital during the first critical months in business. Another important feature of the SBA 504 loan was the rate. The fixed rates on SBA 504 loans are closely tied to the 10 Treasury; and those rates have been steadily declining. As Mr. Patel enthusiastically stated: “it was the perfect time to lock in a fixed rate!”
Questions on SBA 504 loans?
Jessica Armstrong 214-722-7512 or Marilyn Mulvany 817-871-6448 at Alliance Lending CDC