Tap to get financing
SBA 504 Loans
SBA 504 Loans
Loan usesRequirementsDown paymentsRates and costsCalculatorApplication processCompare SBA loansSBA 504 RefinancingApplication ChecklistClosing ChecklistLoan AssumptionFrequently Asked Questions
Requirements Application process Calculator Blog
About
About usContact us
Get financing
Close sba504.loans is an independently owned and operated website and has no government affiliation. We are not the Small Business Administration and are not a lender. If you are trying to reach the SBA click here to be redirected.
Newly Published
Aug 26 at SBA 504 Loans
What Is SBA Form 159?
Aug 26 at SBA 504 Loans
What Is the Small Business Administration?
Aug 26 at SBA 504 Loans
What Is SBA Form 770?
Explore the Janover Network
Mar 27 at Multifamily Loans
Multifamily Minute Reader Reflections: Interest Rate Outlooks
Mar 24 at Multifamily Loans
The Best 3 Multifamily Loans for Affordable Housing in 2023
Mar 20 at Multifamily Loans
Multifamily Minute Reader Reflections: How Will Bank Failures Impact Multifamily?
Was This Article Helpful?
SBA 504 Loan Guide
Last updated on Feb 19, 2023
1 min read

What Is SBA Form 159?

SBA form 159, the Fee Disclosure and Compensation Agreement, is necessary for reporting the fees being paid during an SBA loan transaction. It is a safety net designed to help prevent lenders from paying fees to other parties at your expense. This form is a binding document that spells out what fe

Better Financing Starts with More Options Start Your Application and Unlock the Power of Choice. Click Here to Get Quotes →$1.2M offered by a Bank at 6.0%$2M offered by an Agency at 5.6%$1M offered by a Credit Union at 5.1%Click Here to Get Quotes

SBA Form 159: What You Need to Know

SBA form 159, the Fee Disclosure and Compensation Agreement, is necessary for reporting the fees being paid during an SBA loan transaction. It is a safety net designed to help prevent lenders from paying fees to other parties at your expense. This form is a binding document that spells out what fees are being charged to whom and to whom those monies are being paid.

Note that previously, there were two versions of this form – one for those taking out a 7(a) loan and another for 504 loan borrowers. In September 2018, these forms were combined into a single document by the Office of Financial Assistance (OFA). The current version of the document can be downloaded here.

We’re here to help you get the commercial financing you need. Simply fill out the form below for a risk-free consultation and a free SBA loan quote!

Related Questions

What is the purpose of SBA Form 159?

The purpose of SBA Form 159 is to record any fees getting paid for SBA financing in order to keep lenders from paying related parties additional fees – and then charging you. This keeps the total costs of the loan lower, making affordable loans more of a possibility for small businesses. It is a safety net designed to help prevent lenders from paying fees to other parties at your expense. This form is a binding document that spells out what fees are being charged to whom and to whom those monies are being paid.

Source: www.sba7a.loans/sba-7a-loans-small-business-blog/what-is-the-sba-form-159

Source: sba504.loans/sba-504-blog/what-is-sba-form-159

What information is required to complete SBA Form 159?

You’ll need to gather the following information and have it on hand for each agent or entity who’s received compensation before you sit down to complete Form 159:

  • The total amount you were charged by each agent
  • The business and representative’s name for each agent, along with complete contact information (phone number and business address)
  • The loan applicant’s authorized representative’s name (if applicable)
  • An itemized list (schedule) of services performed, number of hours, and hourly rate billed for each service. for any agents paid more than $2500
  • An itemized and justified compensation list if a disaster loan exceeds $500 (or $2,500 for businesses)

How does SBA Form 159 relate to the SBA 504 loan program?

SBA Form 159 is necessary for reporting the fees being paid during an SBA loan transaction. It is a binding document that spells out what fees are being charged to whom and to whom those monies are being paid. This form is a safety net designed to help prevent lenders from paying fees to other parties at your expense. In September 2018, the two versions of this form – one for those taking out a 7(a) loan and another for 504 loan borrowers – were combined into a single document by the Office of Financial Assistance (OFA).

If you paid your bank any loan packaging fees for closing your loan, or if they’re involved with referral fees, you’ll need SBA Form 159. If you or your lender hired a loan packager, referral agent, broker, accountant, attorney, or independent consultant, you’ll need SBA Form 159. You’ll also need one of these forms for each and every paid party involved in the financing process.

You won’t need a Form 159 for your regular accountant, collateral or business appraisers, commissioned real estate agents nor closing attorneys. Only those individuals directly involved with your loan financing process warrant the extra paperwork.

What are the eligibility requirements for the SBA 504 loan program?

In order to take out an SBA 504 loan, your business must be eligible for the program. The eligibility requirements are pretty simple, though. In order to qualify, businesses must be for-profit enterprises, must not be above a certain size, and cannot be in engaged or involved in certain industries, such as lending money, gambling, speculation, or illegal activities. To help clarify things, we’ve created a quick and easy list to help you determine if your business qualifies for the program:

  • Your business must be a for-profit organization.
  • Your business must meet current SBA size standards.
  • Your business’ net worth cannot exceed $15 million.
  • Your business cannot earn 1/3 or more of its income from packaging SBA loans.
  • Your business must earn an average of $5 million or less per year (after taxes, and only for the preceding two years)
  • Your business cannot be engaged in any sort of passive or speculative activities

Note that additional requirements may be placed by CDCs or conventional lenders. You can find a full list of eligibility requirements and other important information with the SBA here.

What are the benefits of the SBA 504 loan program?

The SBA 504 loan program offers several benefits to businesses, including long-term, fixed-rate financing used to acquire fixed assets for expansion or modernization, lower interest rates and lower down payment requirements than 7(a) loans and express loans, and terms for SBA 504 financing typically of 10, 15, or 20 years. In the case of default, the private lender has first lien on project assets.

For more information, please visit the following sources:

  • SBA 504
  • Private Lender
  • Certified Development Company
  • SBA 504 Loan
  • Interest Rates
  • Down Payment
  • SBA 504 Loans vs 7(a) Loans
  • Private Lender First Lien
Tags
  • SBA 504 Loan
  • SBA 504 Loans
  • SBA Form 413

Getting a small business loan should be easy.⁠ Now it is.

Click below for a free, no obligation quote and to learn more about your loan options.

Get financing →
Janover logo

SBA 504 Loans is a Janover company. Please visit some of our family of sites at: Multifamily Loans, Multifamily Today, Commercial Real Estate Loans, SBA7a Loans, CMBS Loans, Apartment Loans, HUD Loans, HUD 221d4 Loan, HUD 232 Loan, HUD 223f Loan, HUD 223a7 Loan, SBA Express Loans, SBA 504 Loans, and OpportunityZones Help.

Janover Inc.

6401 Congress Ave
Ste 250
Boca Raton FL 33487

[email protected]

Site Information

Privacy Policy
Terms of Use

This website is owned by a private company that offers business advice, information and other services related to multifamily, commercial real estate, and business financing. We are a technology company that uses software and experience to bring lenders and borrowers together.

All users should perform their own due diligence and research. Nothing on this website is an offer or a solicitation for a loan. This website does not endorse or charge you for any service or product. None of the information on this site constitutes legal advice. We are not affiliated with the Small Business Administration (SBA). If you need to visit the SBA directly please click here: sba.gov

Click here for our Advertiser Disclosure.

Copyright © 2023 Janover Inc. All rights reserved.