SESKStuff Everyone Should Know
SESK: Stuff Everyone Should Know · sesk.info/founder-504-not-working-capital

Which need cannot normally be financed with an SBA 504 loan?

A 504 loan cannot normally fund working capital or inventory.

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  1. Long-term equipment
  2. Working capital ✔
  3. An eligible building

Why: The 504 program is designed for qualifying fixed assets. A business seeking working capital or inventory financing should examine other products, such as eligible 7(a) options.

Huh, didn't know that: 504 loans are available exclusively through Certified Development Companies.

The dad joke
Why did inventory miss the 504 bus? It was not a fixed asset.
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References

Answer: Working capital. The 504 program is designed for qualifying fixed assets. A business seeking working capital or inventory financing should examine other products, such as eligible 7(a) options.

  1. SBA 504 loans www.sba.gov/loans/504-loans
    Working capital or inventory
    Checked 2026-10-11.

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