USDA & SBA Loan Guidelines for Industrial Property Financing

Eligible Property Types: Where the principle structure is designed for manufacturing processes, heavy assembly or involves the use of heavy machinery. It contains an average amount of office space commensurate with the quality of the building and the intended use. Loan Size: $250,000 - $5,000,000  SBA: $250,000 - $2,000,000 Eligible Locations: Nationwide Loan Term Amortization: USDA: Maximum 30 years  SBA: 15, 20, 25 years Collateral: First position mortgage as certified by title search and title policy on property. Collateral assignment required. Subordination of tenant leases may be required. Loan Pricing: Determined by pricing matrix. Debt-Service Coverage Ratio: Minimum DSCR of 1.25x depending upon property type, age, physical condition, location, and competitive market position. Loan-to-Value Ratio: 80% LTV. Cash Out Refinance: Borrower must justify proceeds to be used for business purposes only. Minimum 2 years ownership. Maximum LTV is 75%. Loan Escrows: The borrower may be required to contribute monthly to an escrow account for real estate taxes and property insurance. The borrower may also be required to establish a monthly capital replacement escrow reserve equal to the greater of (a) 5% of gross revenues or (b) an amount to be determined by Ocean Capital on the basis of an engineering report and site inspection. Appraisal: Complete summary appraisal required. Environmental Insurance/Screen or Phase 1: Required Survey: No survey required if title company agrees to delete the standard exceptions from the title policy. Reserves at Closing: The borrower shall establish a remediation/repair reserve at closing equal to 125% of the required deferred maintenance repairs as indicated in the environmental and architectural/ engineering reports. Eligible Principals: U.S. citizens, permanent resident aliens, non-permanent resident aliens (with restrictions). Majority principal owners cannot be on probation or parole. Recourse: Every loan will be personally guaranteed by any shareholder with 20%or more ownership in the company.