A Certified Development Company (CDC) is a nonprofit entity that works with the SBA and third-party lenders to promote economic growth within its area of operation. CDCs are SBA-regulated and certified to help lending partners with financing small businesses nationwide. There are 270 CDCs that service specific geographical areas within the United States. To find a CDC in your area, first locate the nearest SBA District Office.

According to the SBA, “A Certified Development Company (CDC) is a nonprofit organization that promotes economic development within its community through 504 loans. CDCs are certified and regulated by the SBA, and work with SBA and participating lenders (typically banks) to provide financing to small businesses, which in turn accomplishes the goal of community economic development.”

Of course, that really doesn’t shed a lot of light on the situation. For another definition, we can turn to the Office of the Comptroller of the Currency, within the Treasury Department. The OCC shares a similar description of what a CDC is, but then continues by explaining that there are currently 252 CDCs in operation nationwide, and each of them is able to offer 504 loans within the entire state in which it is chartered. It is within the bounds of possibility that the SBA could authorize a CDC to offer 504 loans within the continental United States. While each of these organizations is certified by the SBA, they are not part of the organization. While most CDCs work strictly with 504 loans, some of them also work with applicants seeking 7(a) loans, as well.

A Certified Development Company (CDC) plays an important role in the 504 loan process. CDCs are non-profit organizations that are certified and regulated by the SBA to promote economic development in the regions they serve. They offer the SBA 504 loan to companies that meet the eligibility requirements. Local banks and other traditional lenders work with CDCs to fulfill terms of SBA 504 loans, which greatly increases the size of projects funded by the SBA 504. CDCs are responsible for operating, being audited, and managing funds generated from SBA 504 loans.

The benefits of working with a CDC include access to local focus, established relationships with lenders, efficiency, responsiveness, and experience.

CDC's are designed to help strengthen local businesses and support local economies, revitalize neighborhoods, and breathe new life into these areas. They also ensure that women and minority business owners are supported, while also providing help for veterans, and even offering advice and guidance for business owners.

You can find all your options by using the SBA’s search-by-state tool here.

To qualify for an SBA 504 loan, the business must be a for-profit small business with a net worth that is below $15 million. The business must also create or maintain jobs, occupy the property that is acquired, have good credit and a good financial history. Additionally, the business cannot be a non-profit, real estate investor, or religious institution. For more information, please see SBA 504 Loan Requirements for Borrowers, Projects, Lenders, and More and SBA 504 Loans and Commercial Real Estate: What You Need to Know.

A Certified Development Company (CDC) helps small businesses access capital by providing them with access to the SBA 504 loan program. The SBA 504 loan program is a long-term financing option that provides small businesses with up to 90% financing for the purchase of real estate, equipment, and other fixed assets. The loan is typically structured with a 50% loan from a traditional lender, a 40% loan from a CDC, and a 10% down payment from the borrower. The loan terms are typically 10-20 years, with fixed interest rates and no balloon payments. By providing access to the SBA 504 loan program, CDCs help small businesses access the capital they need to purchase real estate, equipment, and other fixed assets.