LAS VEGAS — With the rollout of its new Small Business Administration 504 Secondary Market Program, Member Business Lending, LLC and WesCorp said it is providing a way for credit unions with ways to reduce regulatory caps, improve return on asset, reduce risk and expand business lending options.
Regulations limit a credit union's member business lending assets to 12.25% of total assets. The MBL/WesCorp program aims to help move those assets to the secondary market, eliminating the regulatory cap and freeing up assets for additional business lending, said Kent Moon, president/CEO of MBL at the CUSO's Member Business Lending Leadership Summit in Las Vegas Oct. 9-11.
SBA 504 loans provide long-term, fixed-rate financing to small businesses to acquire real estate or machinery or equipment for business expansion or modernization. Typically a 504 project includes a loan secured from the credit union with a senior lien, a loan secured from a certified development company with a junior lien covering up to 40% of the total cost, and a contribution of at least 10% equity from the borrower.
"This segment of the investment market is showing strong growth and favorable future potential," said Bob Burrell, executive vice president/chief investment officer for WesCorp.
Attendees at the Summit received specific program details and tips on implementing it in their own operations through seminars led by Moon and Burrell. Further information is available by visiting http://www.mblllc.com or by contacting Bethanie Werner, assistant vice president of Credit Union Development at 801-325-6563 or [email protected].
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