The SBA 504 loan program finances major fixed assets — real estate, buildings and heavy equipment — through a Certified Development Company (CDC). A typical project is structured as a third-party lender loan (about 50%), an SBA-backed CDC debenture (about 40%), and a borrower contribution (about 10%). The fees below apply to the SBA-guaranteed debenture, and are set each fiscal year in an SBA Information Notice. This page covers FY 2027, verified against SBA Information Notice 5000-881796.
The two 504 fees for FY 2027
For 504 loans approved October 1, 2026 through September 30, 2027:
| Fee | FY 2027 rate | Charged on |
|---|---|---|
| Upfront guaranty fee | 0.50% (50 basis points) | The debenture amount, once |
| Annual service fee | 0.203% (20.3 basis points) | The outstanding balance of the debenture, each year |
A 504 debt-refinancing loan without expansion carries an annual service fee of 0.204% — the standard 0.203% plus an additional 0.001% (0.1 basis point).
The upfront guaranty fee is a one-time charge and is generally financed into the debenture. The annual service fee is calculated on the balance still owed, so its dollar amount declines as the loan amortizes.
The FY 2027 fee waiver
Information Notice 5000-881796 waives both the upfront guaranty fee and the annual service fee for FY 2027 for 504 loans to:
- Manufacturers (NAICS Sectors 31–33)
- Food supply-chain businesses
- Businesses located in a rural area
Whether a project qualifies is determined and documented by the CDC and SBA, not by the borrower. Because fee relief like this is set one fiscal year at a time, a project that qualifies in FY 2027 is not guaranteed the same treatment in a later year.
Worked example
A 504 project with a $500,000 CDC debenture in FY 2027, standard (non-waived) business:
| Line | Amount |
|---|---|
| Debenture | $500,000 |
| Upfront guaranty fee 0.50% | $2,500 (one time, usually financed) |
| Annual service fee 0.203% (first year, on $500,000) | about $1,015 |
If the same business is a manufacturer or in a rural area, both figures are $0 under the FY 2027 waiver. In later years the annual fee is smaller because it follows the declining balance.
How 504 fees compare to 7(a)
The 504 fees above are small and stable from year to year. A 7(a) loan works differently: its main cost is a one-time upfront guaranty fee charged on the guaranteed portion, rising with loan size (2% up to $150,000, 3% to $700,000, and 3.5%–3.75% on larger loans), plus a 0.55% lender’s annual service fee the lender may not pass to the borrower. If you are comparing the two, see how the SBA 7(a) guarantee fee is calculated, and estimate either with the SBA guarantee fee calculator.
When this schedule applies
These rates apply to 504 loans approved by SBA between October 1, 2026 and September 30, 2027. A loan approved on September 29, 2026 falls under the FY 2026 schedule even if it closes later. SBA publishes a new fee notice before each fiscal year; the source notice and its effective date are linked on this site.
This page is general information, not financial or legal advice. Fee rules are set annually by SBA and eligibility is decided case by case — confirm the current figures and your project’s treatment with your CDC, your lender, and the SBA notice before you rely on them.