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Refinancing with SBA 504: A Smart Move for Oklahoma Businesses
As an Oklahoma business owner, you know that managing finances and securing funding can be a constant challenge. You may have taken out a loan to start or grow your business, but what happens when that loan becomes a burden? High interest rates and steep monthly payments can put a strain on your cash flow and hinder your ability to invest in your business’s growth. That’s where the Small Business Administration’s (SBA) 504 Refinance Program comes in. In this blog post, we’ll dive into the specific rules and benefits of SBA 504 refinancing for Oklahoma businesses, so you can make an informed decision about whether it’s the right move for your company.
- Refinancing with SBA 504: A Smart Move for Oklahoma Businesses
- A Real Oklahoma Business Owner’s Story
- What is SBA 504 Refinancing?
- Who Can Benefit from SBA 504 Refinancing in Oklahoma?
- Credit Score Requirements for SBA 504 Refinancing
- How Long Does Approval for SBA 504 Refinancing Take?
- 3 Common Mistakes Oklahoma Business Owners Make When Refinancing with SBA 504
- A Real Case Study: Oklahoma Business Refinances and Saves
- FAQ: Common Questions About SBA 504 Refinancing
- Take the Next Step and Refinance with GHC Funding
A Real Oklahoma Business Owner’s Story
Meet Sarah, the owner of a small but successful bakery in Oklahoma City. With a bustling downtown location and a growing customer base, Sarah’s business has been thriving. However, when she took out a loan to expand her bakery, she didn’t anticipate the challenges that would come with it. The high interest rate on her loan was taking a toll on her monthly cash flow, making it difficult to invest in new equipment and hire more staff. Sarah knew she needed a solution before her business’s growth potential was hindered by her loan payments. That’s when she turned to GHC Funding for guidance.
What is SBA 504 Refinancing?
SBA 504 refinancing is a program designed to help business owners like Sarah refinance their existing debt, specifically commercial real estate and equipment loans, with more favorable terms. Through this program, business owners can lower their interest rates and extend their loan terms, resulting in lower monthly payments and improved cash flow. The SBA partners with Certified Development Companies (CDCs) like GHC Funding to offer this program to small businesses across the country.
Need capital? GHC Funding offers flexible funding solutions to support your business growth or real estate projects. Discover fast, reliable financing options today!
⚡ Key Flexible Funding Options:
GHC Funding everages financing types that prioritize asset value and cash flow over lengthy financial history checks:
DSCR Rental Loan
- No tax returns required
- Qualify using rental income (DSCR-based)
- Fast closings ~3–4 weeks
SBA 7(a) Loan
- Lower down payments vs banks
- Long amortization improves cash flow
- Good if your business occupies 51%+
Bridge Loan
- Close quickly — move on opportunities
- Flexible underwriting
- Great for value-add or transitional assets
SBA 504 Loan
- Low fixed rates through CDC portion
- Great for construction, expansion, fixed assets
- Often lower down payment than bank loans
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For details on GHC Funding's specific products and to start an application, please visit our homepage:
Benefits for Oklahoma Businesses
There are several benefits of SBA 504 refinancing for Oklahoma businesses:
- Lower Interest Rates: The biggest advantage of SBA 504 refinancing is the potential for lower interest rates. Business owners can save thousands of dollars over the life of their loan by refinancing to a lower rate.
- Extended Loan Terms: With SBA 504 refinancing, business owners can extend their loan terms up to 25 years, providing relief from high monthly payments and allowing for more manageable cash flow.
- Stability and Security: SBA 504 loans are fully amortized, meaning the interest rate is fixed for the life of the loan, providing stability and predictability for business owners.
- Flexibility: Unlike traditional refinancing options, SBA 504 refinancing allows business owners to use the funds for various purposes, such as paying off existing debt, purchasing new equipment, or making improvements to their business.
Who Can Benefit from SBA 504 Refinancing in Oklahoma?
SBA 504 refinancing is an excellent option for any small business owner in Oklahoma who is struggling with high-interest rates and unmanageable loan payments. It is especially beneficial for those who have taken out an SBA 7(a) or 504 loan in the past and are looking to refinance to a more favorable rate. Business owners who are looking to improve their cash flow, reduce their monthly expenses, or invest in their business’s growth can also benefit from SBA 504 refinancing.
Oklahoma Cities with High Demand for SBA 504 Refinancing
Oklahoma is a diverse state with various industries and business opportunities. However, there are a few cities where the demand for SBA 504 refinancing is particularly high:
- Oklahoma City: As the capital and largest city in the state, Oklahoma City is home to many small businesses that can benefit from SBA 504 refinancing.
- Tulsa: Known for its vibrant arts and culture scene, Tulsa also has a strong small business community that can benefit from the SBA 504 Refinance Program.
- Lawton: Located in southwestern Oklahoma, Lawton is a hub for small businesses in industries such as healthcare and education.
Credit Score Requirements for SBA 504 Refinancing
While credit score requirements for SBA 504 refinancing may vary depending on the lender, there are some general guidelines to keep in mind. According to the SBA, the minimum credit score for SBA 504 refinancing is 680. However, this is not a strict requirement, and business owners with slightly lower credit scores may still be eligible for the program. It is essential to work with a reputable lender like GHC Funding to assess your credit score and determine your eligibility for SBA 504 refinancing.
How Long Does Approval for SBA 504 Refinancing Take?
The time it takes to get approved for SBA 504 refinancing can vary depending on several factors, such as the complexity of your loan and the efficiency of your lender. However, on average, the approval process can take anywhere from 45 to 90 days. It is crucial to work with an experienced lender like GHC Funding to ensure a smooth and timely approval process.
3 Common Mistakes Oklahoma Business Owners Make When Refinancing with SBA 504
When considering SBA 504 refinancing, business owners in Oklahoma should be aware of some common mistakes to avoid:
- Not Understanding the Requirements: It is crucial to have a clear understanding of the requirements and guidelines for SBA 504 refinancing before applying. Working with a knowledgeable lender like GHC Funding can help ensure that you meet all the requirements and avoid any potential roadblocks.
- Not Being Prepared: The refinancing process can be lengthy, and it’s essential to have all your documents and information ready to expedite the process. Make sure you have your financial statements, credit reports, and tax returns readily available to avoid delays.
- Choosing the Wrong Lender: Choosing the right lender is crucial when it comes to SBA 504 refinancing. Working with a lender who is experienced in SBA loans and has a track record of successful refinancing can make all the difference in the success of your refinancing process.
A Real Case Study: Oklahoma Business Refinances and Saves
Let’s take a look at a real-life example of how SBA 504 refinancing helped an Oklahoma business owner improve their financial situation:
John owns a manufacturing company in Tulsa, Oklahoma. He had taken out a loan to purchase new equipment, but the high-interest rate was taking a toll on his business’s cash flow. John was struggling to make ends meet and realized he needed a solution to reduce his loan payments. That’s when he decided to refinance his loan with GHC Funding through the SBA 504 Refinance Program. By refinancing, John was able to lower his interest rate from 8.5% to 5.5%, saving him ,500 per month on his loan payments. This improvement in cash flow allowed John to invest in new equipment and hire additional staff, ultimately leading to an increase in his business’s profitability.
FAQ: Common Questions About SBA 504 Refinancing
Here are some of the most frequently asked questions about SBA 504 refinancing:
- Can I refinance as an existing SBA borrower? Yes, business owners who have an existing SBA loan can refinance through the SBA 504 Refinance Program.
- Can I use the funds for other purposes besides paying off existing debt? Yes, as long as you meet the eligibility requirements, you can use the funds for various purposes, such as purchasing new equipment or making improvements to your business.
- Is there a limit on the amount I can refinance? The maximum amount you can refinance is 90% of the current appraised value of your commercial real estate or equipment.
- What are the fees associated with SBA 504 refinancing? The fees for SBA 504 refinancing include a one-time guarantee fee of 0.5% for loans between $1 million and $5 million, and an annual servicing fee of 0.375%.
Take the Next Step and Refinance with GHC Funding
If you’re a small business owner in Oklahoma and are struggling with high-interest rates and unmanageable loan payments, SBA 504 refinancing may be the solution you’ve been looking for. At GHC Funding, we have years of experience helping business owners like you navigate the refinancing process and secure more favorable rates and terms. Our team is dedicated to providing personalized and comprehensive financing solutions that cater to your specific business needs. Contact us today to learn more about SBA 504 refinancing and take the first step towards securing a brighter financial future for your business.
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