The Appalachian Development Corporation (ADC) is certified by the Small Business Administration as a Certified Development Corporation with a primary area of coverage being the six counties of the upstate, and a secondary area of anywhere in the State of South Carolina. The ADC operates the 504 program in conjunction with the local financial community who provides primary financing on projects.

The SBA 504 Loan Program provides long-term, fixed rate, subordinate financing for acquisition and/or renovation of capital assets including land, buildings and equipment. Virtually all types of for-profit businesses are eligible for this program.

The typical financing structure for existing businesses consists of a 50% first mortgage by a financial institution, 40% through the SBA 504 program with a second lien position, and the applicant has to contribute 10%. For Startup businesses the maximum amount of 504 funding is 35% of the project.

The SBA portion through the ADC can be up to 40% with a normal maximum of $2,000,000. Manufacturing companies have a maximum of up to $4,000,000.

The term for the SBA portion is either 10 or 20 years with monthly payments.

The interest rate is a fixed rate for the duration of the loan and is normally at or below market rates.

Application processing through ADC is at no cost. Loan fees for the SBA portion normally cost between 2 and 3.5% and are financed in the transaction.

The financial institution sets its own interest rate, terms, and fees on its portion of the project.

All project costs can be financed including acquisition costs and soft costs, such as life insurance, legal costs, appraisals, environmental reports, and bridge loan costs.

Collateral typically consists of the assets being financed leaving other company assets available as collateral for other borrowings.