Question 1

What types of commercial properties can I finance?

Accepted Answer

Commercial real estate loans can finance a wide variety of property types, including office buildings, retail centers, warehouses, industrial properties, mixed-use buildings, and special-purpose properties like medical offices or self-storage facilities. The terms and requirements may vary depending on the property type and its intended use.

Question 2

How much down payment is required for commercial real estate?

Accepted Answer

Commercial real estate loans typically require a down payment of 20% to 30% of the purchase price, though this can vary based on the property type, loan program, and borrower qualifications. SBA loans may offer lower down payments for qualifying owner-occupied properties.

Question 3

What are typical commercial loan terms?

Accepted Answer

Commercial loans typically have terms of 5 to 25 years, with amortization periods that may extend to 25 or 30 years. Many commercial loans include a balloon payment at the end of the term. Interest rates can be fixed or variable. Your loan officer can explain the specific terms available for your transaction.

Question 4

What documents do I need to apply for a commercial real estate loan?

Accepted Answer

Lenders typically require business financial statements (profit and loss, balance sheet), personal financial statements, two to three years of business and personal tax returns, a business plan, property information including appraisal and environmental reports, and rent rolls for income-producing properties. Requirements vary by lender and loan program.

Question 5

Can I finance a mixed-use property with a commercial loan?

Accepted Answer

Yes. Mixed-use properties that combine commercial and residential space can be financed with commercial loans. If the property is primarily residential (e.g., four or fewer residential units with ground-floor commercial), it may qualify for residential financing. Your loan officer can determine the best financing approach.

Question 6

How long does it take to close a commercial real estate loan?

Accepted Answer

Commercial loan closings typically take 30 to 90 days, depending on the complexity of the transaction, the type of loan program, and the due diligence required. SBA loans may take longer due to government processing requirements. Having your documentation prepared in advance can help expedite the timeline.

Commercial Real Estate Financing

Key Benefits of Commercial Real Estate Loans

Competitive Rates

Flexible Terms

High Loan Amounts

Various Property Types

Ideal For:

Frequently Asked Questions

Related Resources

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