Commercial Real Estate Loans — Buy, Build, or Refi

Commercial Real Estate Loan at a glance

Typical amount

$250,000 – $25,000,000

Typical term

5 – 30 years

APR

6% – 12% APR

Minimum time in business

2 years

Minimum credit score

650+

Common uses for a Commercial Real Estate

• Purchase
• Renovation
• Refinance
• Ground-up construction

How LendWorks matches you with a Commercial Real Estate lender

1. Apply in about two minutes — no credit-score impact.
2. Our AI underwriting engine grades your file and matches you with a dedicated advisor.
3. Your advisor presents vetted Commercial Real Estate Loan offers side by side — you choose or walk away.

Commercial Real Estate Loan FAQs

What is a Commercial Real Estate Loan?

Commercial real estate loans finance the purchase, renovation, or refinance of income-producing or owner-occupied commercial property.

How much can I borrow with a Commercial Real Estate?

Typical funding amounts range from $250,000 – $25,000,000. Your exact offer depends on revenue, time in business, credit profile, and business performance.

What are the rates for Commercial Real Estate Loan?

Commercial Real Estate Loan typically runs 6% – 12% APR. Your actual pricing depends on revenue, time in business, credit profile, and term — your advisor breaks down the real cost and total payback before you commit, so there are no surprises.

How long does it take to get funded with Commercial Real Estate Loan?

Funding timelines vary by product and lender — some options fund within a few business days, while larger or government-backed programs take longer. Your advisor gives you a realistic timeline for Commercial Real Estate Loan based on your documents and lender fit.

What do I need to qualify for Commercial Real Estate Loan?

Most lenders look for at least 2 years in business and a 650+ credit score. Your advisor will assess your full profile.

Is Commercial Real Estate Loan right for my business?

Commercial Real Estate Loan fits best when you need purchase or renovation and can work with a 5 – 30 years term. If your timeline is longer or you can wait for a lower rate, your advisor may recommend an alternative — the goal is the right fit, not just the fastest approval.

How does LendWorks match me with a Commercial Real Estate lender?

LendWorks runs your profile through AI underwriting to match you with a real advisor — not a lead form. Your advisor reviews your situation and presents options from our vetted lender network.

Does applying for Commercial Real Estate Loan hurt my credit score?

Checking your options with LendWorks does not impact your credit score. We use a soft pull to assess eligibility. A hard pull only occurs when you move forward with a specific lender offer.

Frequently asked questions

What is a Debt Service Coverage Ratio (DSCR) and why does it matter?

DSCR measures a property's ability to cover its debt obligations from its own income. The formula is: Net Operating Income (NOI) ÷ Total Annual Debt Service (principal + interest). A DSCR of 1.25 means the property generates 25% more income than needed to cover the loan payment. Most commercial lenders require a minimum DSCR of 1.20–1.25 for investment properties and may apply a "global cash flow" analysis for owner-occupied properties that also includes the business's income. Properties with DSCR below 1.0 are "cash flow negative" and very difficult to finance conventionally.

What is the difference between an owner-occupied and investment commercial real estate loan?

Owner-occupied CRE loans finance properties where the borrower's business occupies at least 51% of the space — the business is the primary tenant. These loans are underwritten primarily on the business's financial strength and can access SBA 504 financing (90% LTV). Investment property loans finance properties where the income comes from third-party tenants — the debt is serviced by rents, and underwriting focuses on the property's NOI and DSCR. Investment properties typically require larger down payments (25–35%) and cannot use SBA programs.

What is a commercial bridge loan and when should I use one?

A commercial bridge loan is short-term financing (typically 6–36 months) designed to bridge a timing gap — most commonly when a borrower needs to close quickly before permanent financing can be arranged, or when a property needs renovation before it can qualify for a conventional mortgage. Bridge loans close in 7–21 days, require less documentation, and accept properties in transitional condition. They carry higher rates (typically 8–14% vs. 5–8% for conventional) and are intended to be refinanced into permanent financing once the property is stabilized.

How is commercial real estate financing different from residential mortgages?

Commercial real estate loans are underwritten primarily on the property's income-generating ability (NOI/DSCR) rather than just the borrower's personal income. Loan terms are shorter — typically 5, 7, or 10 years with a balloon payment — even if the amortization period is 20–30 years. Interest rates are generally higher than residential rates. Commercial loans are not standardized like Fannie/Freddie residential mortgages, meaning each lender sets its own criteria. Closing costs are higher (typically 2–5% vs. 1–2% for residential) and include appraisal, environmental reports, and title insurance specific to commercial property.

What is a balloon payment in a commercial mortgage?

Most commercial real estate loans have a split structure: the amortization period (how long it would take to fully repay the loan at the current payment) and the loan term (when the balance is due). For example, a 10-year term with 25-year amortization means your monthly payments are calculated as if you are repaying over 25 years, but at year 10, the remaining balance — the "balloon" — is due in full. At that point, you must refinance, sell the property, or pay off the balance. Understanding the balloon date is critical for long-term investment property planning.

What types of commercial properties can be financed?

Lenders finance a wide range of property types: office buildings, retail strip centers and standalone stores, industrial warehouses and distribution centers, multi-family residential (5+ units), mixed-use (residential over retail), hotels and hospitality, self-storage facilities, medical and dental office buildings, and special purpose properties (restaurants, car washes, gas stations). Special purpose properties — those designed for a single use — typically require higher down payments and specialized lenders because they have limited alternative-use value in foreclosure.

How much down payment do I need for a commercial real estate loan?

Down payment requirements depend on property type, loan program, and borrower profile. SBA 504 loans for owner-occupied properties allow as little as 10% down (90% LTV). Conventional bank commercial mortgages typically require 20–30% down (70–80% LTV). Bridge and hard money loans may require 30–40% down. Investment properties with strong DSCR from established investors sometimes qualify for 75% LTV (25% down) with conventional lenders. The strongest borrowers can occasionally find 80–85% LTV on well-leased, institutional-quality properties.

What is a commercial real estate appraisal and who pays for it?

A commercial appraisal is an independent, licensed appraiser's opinion of value for the subject property, required by virtually all commercial lenders to establish the loan-to-value ratio. Commercial appraisals consider three approaches: the income approach (capitalized NOI), the sales comparison approach (comparable sales), and the cost approach (replacement cost). They cost $3,000–$10,000+ depending on property complexity and size. The borrower pays for the appraisal — either as part of the application process or at closing. The appraisal is ordered by the lender but the cost is passed through to the borrower.