The Obama administration has created a niche outlet for certain commercial real estate loans as part of its effort to boost business lending through the purchase of Small Business Administration-backed loans. The Treasury Department has pledged to purchase $15 billion in SBA loans, including SBA '504' first-lien mortgages that are used to finance owner-occupied buildings and construction projects. (The 504 loans cover up to 50% of a project's cost but are not government guaranteed.) Treasury will begin purchasing 504 loans no later than May. SBA also is working on the development of a "secondary market guarantee program for securities issued from pooled 504 first mortgage loans," Treasury said.
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