504 SBA Loan Eligibility - 51% Owner Occupancy

[Jj Ll]

I am trying to determine whether to use the 504 Loan to purchase an office building.  While I intend to use 51% or more for my business, I would like to know (from those who have experience with this type of loan) what happens if in 4 yrs I reduce my occupancy to say 40% (due to change in business needs).  Does the SBA check on occupancy for the life of the loan?

Thanks.

[Eric Odum]

I am not sure of the regs, but the handful of clients we have had who acquired 504's have experienced no issues.  There doesn't appear to be an audit down the road after closing to make certain you are in compliance.   I am sure people's situations change and these loans must take this fact in to effect, I would think, anyway.  I would love to hear if someone else had a different experience.