Certified Development Company Loan Program Law and Legal Definition

Certified Development Company Loan Program is a program of the U.S. Small Business Administration which provides financing for the purchase of fixed assets at below market rates. This program works by distributing the loan among three parties:

The business owner puts a minimum of 10%

A conventional lender like a bank puts up 50%

A Certified Development Company puts up the remaining 40%

In order to qualify for the loan, the business must be operated for profit and must fall within the size standards set by the SBA. The loan amount cannot be used for working capital or inventory, consolidating or repaying debt, or refinancing.

Certified Development Company Loan Program is also known as SBA 504 loan.