Big Sky Finance 504 For Lenders

Financing Montana Business Opportunities

Let us partner with you on financing…

Big Sky Finance is here to partner with our lenders in order to provide the best long-term financing tool available to Small Business owners for their real estate and/or equipment financing needs.  Leave the SBA paperwork to us – working together, we will make the process simple for you, so you are able to stay focused on serving your customers!

Big Sky Finance is a statewide certified development company licensed by the SBA to administer the SBA 504 Loan program in Montana. The SBA 504 Loan program is a direct SBA lending program designed to provide long-term, below-market, fixed asset financing to small, for-profit businesses. The SBA 504 Loan program represents permanent financing and is an economic development program utilizing job creation.

Eligible Uses

  • Purchase land and improvements (operating company must occupy 60% of new buildings and 51% of existing buildings.)
  • Construction of new facilities, or modernizing, renovating, or converting existing facilities.
  • Refinancing of existing debt in some circumstances.
  • Machinery and equipment with a minimum useful life of 10 years.
  • Soft costs including but not limited to, title searches, appraisals, environment reports, architect fees, interim loan interest, certain bank fees, furniture and fixtures

Ineligible Uses

  • Inventory
  • Working capital
  • Intangibles

Small Business Defined As

Tangible Net worth of not more than $15 million and 2-Year average Net Income after taxes less than $5 million.

Economic Development Requirements

  • Job creation or retention (one job per every $75,000 borrowed from SBA 504), OR
  • Public policy or community development goals met (various options available).
  • Manufacturing firm (one job per every $120,000 borrowed from SBA 504)

Rates and Terms

  • SBA rate fixed for the term of the loan (20-year rate is tied to the 10-year Treasury bond rate).
  • The private lender sets their own rates and fees (commercially reasonable).
  • Loan terms are 10, 20, or 25 years (Real Estate: 10, 20, or 25 year note, Equipment only: 10 year note).

Fees and Payments

  • All SBA 504 loan fees are added to the loan amount and amortized over the loan term. One time processing fee of approx. 2.15% of SBA’s portions, loan closing fees of approx. $2500
  • On-going service fee included in the effective full-term rate.
  • Prepayment penalty for 1st half of term of SBA note—declining prepayment scale.

Example Of Financing On A Typical $1 Million Project

Total Project Cost:
Acquisition of Land & Building $800,000
Improvements $180,000
Soft costs (appraisal, architect, engineering, closing costs) $20,000
Total $1,000,000
Project Financing:
Entity Loan Amount % of Project Security
Bank $500,000 50% 1st Lien
CDC/SBA 504 Loan $400,000 40% 2nd Lien
Borrower down payment* $100,000 10%*
Total $1,000,000 100%

* Start-up OR Special Purpose Building (i.e. car wash, hotel) requires 15% equity. Start-up AND Special Purpose Building requires 20% equity. Borrower down payment can be in the form of: cash, land equity, seller carry-back note (term must match SBA term and be subordinated to SBA if secured by project RE), or any combination thereof.

Typical Deal Structure For An Existing Business Would Be:

  • 10% Owner Equity
  • 50% Lender Financing (senior position on collateral)
  • 40% SBA Financing (junior position on collateral)

Additional equity of 5% or 10% may be required—new business or special property.

SBA 504 Borrower Checklist Items needed for application.

Business Information

  • Business financial statements for the last 3 years, along with A/R and A/P aging reports
  • Business tax returns for the last 3 years
  • Business debt schedule
  • Two years projected income statement with assumptions broken down by month for 1st year
  • Interim financial statements within last 60 days
  • Affiliated business – 2 years financials and current financial statements (if applicable)

Legal Entity Documents (as applicable)

  • Sole Proprietorship – Assumed Business Name filing
  • Corporation – articles of Incorporation & corporate By-Laws
  • LLC – Articles of Organization & Operating agreement to Partnership – Partnership agreement
  • Franchise agreement (if applicable)

Personal Information (for each 20% owner)

  • Personal tax returns for last 3 years
  • Personal Financial Statements (SBA Form 413)
  • Personal History Statements (SBA Form 912)
  • Copy of driver’s licenses

Real Estate Information

  • Real Estate Purchase agreement or Settlement Statement
  • Construction cost budget and / or equipment bids
  • Existing Environmental studies
  • Appraisal

** All financial statements must be signed and dated by the applicants – please sign front page of all financials (tax returns, interim statements, personal financials, etc.)


Brandon Berger, Pam Bolin, and Mac Ketterling were great to work with. There’s a mountain of paperwork associated with this type of thing, I don’t think you could prepare all of the documents needed as a business owner. They made it easy—they were professional, knowledgeable, and were available to answer all of our questions.
Kat Healy
Red Oxx Manufacturing, Billings
Big Sky Economic Development played an integral role in the development of Simms Fishing Products’ new state of the art manufacturing facility in Bozeman. The programs and expertise that BSED provides are invaluable for the growth of companies like Simms in Montana.
Weston Fricke
Simms Fishing Products, Bozeman
My experience working with the Big Sky EDC on our SBA 504 loan has been an exceptionally smooth and seamless process. The professional staff provided me with clear and concise instructions as to what I needed to provide them for the application and they did the rest. I was able to concentrate on growing my business rather than being bogged down in the loan process. I would highly recommend any business with expansion plans get in touch with Brandon Berger and his team.
Kevin Gustainis, President
Montana Peterbilt, Billings
The 504 loan program was very beneficial to us because we were guided through the whole process, from start to finish. we were given the opportunity to successfully build our business from the ground up.
Laura Johnson, Owner
The Firehouse Gym, Big Timber
The Firehouse’s long-term financial obligations are known within this loan program, helping us to more accurately forecast the future of the business.
Jeff Johnson, Owner
The Firehouse Gym, Big Timber
25-Year 20-Year 10-Year
5.12% 5.06% 4.93%

Director of Business Finance Brandon Berger 406-869-8403

Loan Officer JoAnn Jones 406-441-5447

Loan Specialist Johnna Jablonski 406-869-8415