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|Schaefer Technologies fills new machinery orders with temporary SBA 504 refinancing from First Merchants Bank and Indiana Statewide CDC
An influx of orders for custom machines led Schaefer Technologies, Inc. of Indianapolis to take advantage of a refinancing option available only for a short time from the U.S. Small Business Administration 504 loan program.
First Merchants Bank and the Indiana Statewide Certified Development Corporation provided the SBA 504 loan. The SBA 504 program finances real estate and equipment purchases; the refinancing feature expires September 27 unless Congress extends it.
Schaefer Technologies, Inc., located on the near west side of Indianapolis, manufactures and distributes capsule filling machines and other specialized equipment for pharmaceutical, health, nutrition, automotive and manufacturing industries.
Indiana Statewide CDC works with local lenders to provide SBA 504 loans to owners of expanding companies. Congress created the SBA 504 program so owners of small businesses could get long-term, fixed rate financing with lower down payments similar to financing commercially available for large companies.
Steven Schaefer, president of Schaefer Technologies, says, "We funded orders from our own pockets, but as volume picked up and deadlines moved forward, we needed more capital. The SBA 504 loan is a tremendous help to us. In essence, the loan allows us to tap into the equity we had in our building to fund working capital."
Jeff Pangburn of First Merchants Bank says, "The SBA 504 loan package reduces collateral risk and gives bankers assurance to move ahead with funding worthwhile projects."
Executive Director Jean Wojtowicz says that the Indiana Statewide CDC has invested over $385 million in more than 1,000 Indiana companies since 1983, creating or saving 26,500 jobs. Indiana Statewide CDC is the leading SBA 504 lender in Indiana.
In the U.S. since 1981, SBA 504 loans have funded over $62 billion to more than 130,000 small businesses. In turn, those small firms have created or retained over 2.1 million jobs.
About 55 people are employed by Schaefer Technologies. Schaefer says, "These are talented people who build sophisticated machines from the floor up. These are the kinds of jobs that create capital and build a strong economy. As a company, we are happy that First Merchants, the Indiana Statewide CDC and the SBA were able to assist our growth."