Central Minnesota Development Company [CMDC]

The 504 loan is typically secured with a subordinate lien on all project assets.
The SBA 504 loan must have a security interest in all project assets. Existing prior liens can be recognized in the case of building expansions and renovations.
Personal guarantees are required from all principals owning 20% or more of the operating company and borrowing entity .
If the business is a start-up or the asset being financed is considered single purpose or the credit is unusually risky, additional collateral may be required.
"Key Man" life insurance is typically required unless there is strong management succession.