Remove Lender Risk from SBA 504 Loans. Close Your 504 Loans while awaiting SBA Approval.
The Velocity Bridge Loan Program minimizes or eliminates risks for banks and other third-party lenders who finance first lien loans (typically for 50% of project costs) for SBA 504 Loan Program participants. The program provides these lenders with bridge loan funds to cover the “debenture funding”– the second lien loan (typically 30% – 40% of the cost, financed by FBDC), prior to the permanent takeout of the SBA second mortgage.
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Who’s It For?
Benefits
Difference Makers
The Velocity Competitive Advantage
The Velocity Bridge Program (VBP) offers several advantages over other bridge lending programs. First, because this is a proprietary platform that is not state run, VBP can offer fast and flexible solutions to meet any potential borrower need. This includes the ability to underwrite, approve, and close loans in under 10 business days. VBP can also make any size bridge loan and any length up to 24 months.
Second, bridge loans through VBP are completely subordinated to the 1st lien permanent lender, instead of on a pari passu basis. This coupled with our willingness to fund our loan amount first, gives that the permanent lender has the most protection on their loan.
Third, the Velocity Bridge Program has the ability to fund the entire loan during the interim period (1st and 2nd lien), which will completely eliminate construction or SBA debenture risk for the permanent lender.
Finally, VBP loans can be used for any type project including acquisitions, tenant improvements, and ground up construction, and it can be used for any eligible SBA product type.
| Velocity | State Program | |
| Acquisiton/Renovation | Yes | Yes |
| Ground Up Construction | Yes | Yes |
| Lien Position | 2nd Lien Subordinated | Pari Passu |
| Loan Funding | Can fund 1st | Funds on a Pari Passu basis |
| Interim Loan Amount | $100M ‐ $12MM | $250M ‐ $5MM |
| Initial Max Term: | Can be length up to 24 Months | Maximum 6 Months |
| Interim interest Rate | Acquisition = Prime +3.00% Construction = Prime + 3.74% | min. 1st lien lender rate |
| Interim Fee | 1.75% ‐ 2.25% | .5% for acquisition 1% for construction |
| App fee/ Deposits | < $3.5M = $3,500 $3.5MM = $6,500 | n/a |
| Construction Management fee | Third Party Cost | Unknown |
| Ext. Fee | 1.00% | .25% every 6 months |
| Ext. Rate | Original Rate | Original rate + 2.00% |
Additional Notes:
*Up to 50% of the App Fee is refundable
*State Program also charges a servicing fee for acquisition and renovation projects during the first 6 months. They charge 1.25% divided by the interest rate (1.25%/8% = servicing) fee onto the rate.
*State Program uses 6 month terms standard with 6 month extensions
Our History
Lincoln Capital and Florida Business Development Partnership formed in 2019
Millions funded over the 3 year history
Enabled closings that banks and borrowers deemed ‘dead deals’
Provided necessary capital to close loans during the COVID-19 crises