$100K to $20M, all 50 states
Commercial real estate financing
Make space to grow. Commercial real estate loans help you purchase, renovate, or expand property for your business or for steady rental income, with 1st and 2nd positions and interest-only options available.
What is a commercial real estate loan?
A commercial real estate (CRE) loan is financing secured by a lien on commercial property rather than a home.
CRE loans are usually tied to income-producing property and are used to purchase, renovate, or expand a new or existing site. Owning and operating commercial real estate is often done through a company set up specifically to buy property and lease it, and a real estate loan can finance the purchase, development, or construction that attracts stable rental income.
If you are buying property your own business will occupy, an SBA 504 loan may also be worth comparing.
Program highlights
- Loans from $100,000 to $20,000,000
- Available in all 50 states
- Offered in 1st and 2nd lien positions
- Interest-only options available
- 500 FICO required to apply
- No minimum gross sales
What CRE loans are used for
Common uses
- Purchasing commercial property
- Renovating or expanding an existing site
- Development and construction
- Refinancing existing property debt
Common property types
- Office buildings
- Retail centers and storefronts
- Hotels and hospitality
- Apartments and mixed-use
Who CRE loans are made to
Loans are most often made to partnerships, developers, funds, trusts, corporations, and real estate investment trusts (REITs), as well as operating businesses buying their own space.
Requirements and documents
Minimum qualifications
- 500 minimum FICO credit score
- Two years of business tax returns
- A down payment, which varies by deal
What you'll need to apply
- A 1003 loan application
- A personal financial statement
- A real estate schedule
- 2 years of business tax returns
How the CRE financing process works
01
Check your options
Start with the 60-second form and tell us about the property, the purchase price or value, and how you plan to use it.
02
Deal review
A specialist reviews the property, your down payment, and your experience, and matches the deal with lenders and loan structures that fit.
03
Underwriting and third-party reports
The lender orders an appraisal and title work and reviews your financials. This stage usually drives the timeline.
04
Closing
You review the final terms, sign, and the loan funds at closing. Typical deals take several weeks from application to funding.
Is a commercial real estate loan right for you?
It tends to fit when
- You are buying, building, or improving income-producing or owner-occupied property
- You have a down payment and two years of business tax returns
- A long-term, property-secured loan fits your plan
Consider something else when
- You need smaller, faster funding for operations; see working capital
- Your revenue is mostly card sales and you need speed; see revenue based financing
- You are buying owner-occupied property and can wait for the lowest cost; compare SBA loans
Frequently asked questions
Q01What are CRE loans most commonly used for?
CRE loans are most often used to purchase, renovate, or expand a new or existing commercial site, and to refinance existing property debt.
Q02What types of businesses typically apply for CRE loans?
The most common applicants are offices, retail, hotels, and apartments, but other commercial property types can apply too.
Q03What types of entities are CRE loans typically made to?
Most often partnerships, developers, funds, trusts, corporations, and real estate investment trusts (REITs), as well as operating businesses buying their own space.
Q04What is the difference between a 1st and 2nd position loan?
A 1st position loan has the first claim on the property. A 2nd position loan sits behind an existing first mortgage, so it is usually smaller and priced higher because the lender is repaid second.
Q05What does interest-only mean on a CRE loan?
For a set period, you pay only the interest, not the principal, which lowers payments early on. After that period, payments rise to include principal, or the balance comes due.
Q06Do I need a down payment?
Yes. Commercial real estate loans require a down payment, and the amount varies by deal, property type, and lender.
Sources and further reading
- 504 loans, U.S. Small Business Administration
- 7(a) loans, U.S. Small Business Administration
Financial disclaimer: This page is for general information and is not financial, legal, or tax advice. SmallByzLoans is a funding marketplace, not a lender. Approval, amounts, rates, and terms are set by each funding provider and are subject to underwriting.
Make your next move in commercial property
Start with the 60-second form. No cost to check your options, and expert guidance from start to finish.