Tools to Get Started

504 and 166 Loan Application Checklist

  • History and Description of Business and Owner Resumes
  • Project Description including specific Use of Loan Proceeds
  • Cost Verification – Purchase Agreement and/or Third Party Cost Estimates
  • Business Financial Information — Last 3 years of Income Statements & Balance Sheets
  • Business Tax Returns for Last 3 Years
  • Current Business Financial Statement (less than 90 days old)
  • Current Personal Financial Statement from all 20%+ Owners
  • Personal Tax Returns Last 3 Years from all 20%+ Owners
  • Business Financial Projections for 3 Years may be required.
  • Last 3 Years Business Financial Information of Affiliate Businesses, if Any
  • Conditional Bank Commitment Letter
  • Appraisal by Qualified Appraiser
  • Environmental Investigation, as appropriate, for the site
  • OSDC Loan Application Fee


Frequently Asked Questions

What is the best way to find out if a 504 or 166 loan can work for my business?
Talk to your banker about these programs and call OSDC at 614/481-3214 or email at

Are there fees associated with these programs?
Yes. The SBA 504 loan includes processing fees, closing costs, and the Third Party Lender fee. Most of these fees can be financed and added onto the loan amount. The 1.5% 166 Loan fee is usually paid out of pocket and is either 1.5% or 2.5% depending on whether the loan has a subordinate lien position.

Is debt refinancing allowed?
Yes. The 504 program can participate in projects that include existing debt.

So you will finance start-ups?
Only when it makes the most sense from an operations and financial perspective. Additional equity and sometimes additional collateral would be required in order to offset the risk which is inherently involved in any new business.

Do you provide start-up financing?
A 166 Regional loan could help a new business purchase equipment. An SBA 504 loan could be considered for a start-up business purchasing equipment that has a ten-year life. In most cases, a start-up business isn’t ready to make an investment in real estate until after it has established a track record and proven itself. However, there are exceptions due to the special nature of a business, when an existing company is expanding to a second location or when an established company is branching out into a related field.

Will using a 504 or 166 loan delay my project?
A project utilizing 504 financing can proceed according to the policies of the participating lender; however, the SBA is not 100% committed to make the loan until it is approved in writing by the SBA. A 166 Regional loan requires approval by the State Controlling Board before the project can move forward. In exceptional cases, with prior notification, the State will allow a project to go forward at its own risk.

Why should my business go to the extra effort to get a 504 or 166 loan?
The benefits to a business include a fixed rate of interest for the term of the loan; low down payment; longer term, and; overall more financing than what may be available through a conventional lender alone. In most cases, the borrower’s down payment will be 10% of project costs. Also, the 166 loan offers an attractive fixed rate that is below market rate. The 504 loan rates are generally below market and fixed for the term of the loan.

Is it true that these loans require a lot of paperwork and that it takes a long time to get approval?
OSDC tries very hard to minimize paperwork and provide a quick response to any loan request. Documentation for 504 and 166 loans closely follows your bank’s application requirements, so OSDC usually just needs a copy of what you have given your banker. The OSDC staff’s in-depth experience with these programs allows us to determine within several business days if a 504 or 166 loan is a good fit for your project. If yes, then loan approval usually occurs within 30 -60 days.

How much can I borrow?
Both the 504 and 166 programs usually lend up to a maximum of 40% of a real estate or equipment project. The rest comes from another lender (usually a bank) and equity. The 504 loan can be at most $5 million depending on your particular situation. The 166 Regional loan maximum is $500,000.

When should my business consider using an SBA 504 or 166 Regional loan?
When your business needs to make an investment in real estate or equipment. This can mean purchasing, constructing or renovating a building that your business will substantially occupy. An SBA 504 loan can also help purchase and install equipment that, on average, has at least a ten-year life. A 166 Regional loan can help finance shorter-life equipment.