Friday, June 12, 2026New York · LondonSOFR 5.32Prime 8.50
Capital Desk · OpenVol. VII · No. 26
Equipment Loan vs SBA 504.
For heavy equipment purchases over $500k, the SBA 504 and a conventional equipment loan are direct competitors. The 504 is cheaper long-term but slower; the equipment loan funds in days but prices higher.
| Dimension | SBA 504 | Summit |
|---|---|---|
| Pricing | Fixed second-lien debenture rate (typically 6.5–7.5%) | 7–18% APR depending on credit and asset class |
| Term | 25 years (real-property-attached) or 10 years (equipment) | 36–84 months |
| Down payment | 10% borrower equity | 0–20% depending on file |
| Speed to fund | 60–120 days | 24–72 hours |
| Eligible equipment | 10+ year useful life, owner-used | Any titled or invoiceable equipment |
| Best for | Heavy equipment over $500k that will be owned long-term | Fast capex, mixed-use fleets, or files outside the SBA box |
Verdict
If the equipment is over $500k, has a 10+ year useful life, and you can wait 90 days, the SBA 504 is dramatically cheaper. For anything time-sensitive, smaller, or shorter-lived (vehicles, tech, lighter machinery), conventional equipment financing wins on speed and flexibility.