A Commercial Real Estate mortgage loan is a type of loan for purchasing, renovating, or refinancing a commercial property. There are many providers of commercial real estate mortgages that offer mortgages with different requirements, terms, and interests. However, finding the best lender will depend on your loan purpose.
Before taking a loan, go through various lenders to learn their rates, then compare and select the one whose terms best match your needs. This article lists the top five providers of commercial real estate mortgages and what each of them offers.
The U.S. bank offers different types of mortgages for commercial properties, including SBA loans. These loans are ideal for people who want a long-term mortgage. Furthermore, the interest rate is 5% to 7%, and the bank offers both variable and fixed interest.
The terms for a borrower to take an SBA loan is to own 50% or more of the property being financed. In addition, the U.S. Bank has a minimum 700 credit score requirement for borrowing.
JPMorgan Chase features as the topmost multifamily lender and offers cost-effective financing solutions with fast loan closing. In addition, the interest rate is 5% to 9%
The maximum CRE loan you can borrow is $15 million, which extends to more than $25 million for multifamily units. However, to acquire a multifamily loan, an apartment building must have at least have 5 units.
SmartBiz is a perfect choice for borrowing commercial SBA 7(a) mortgages. Due to the SBA guarantee, online rates for these loans are lower than traditional bank rates. Moreover, the interest rate is 4.75% to 7%
An SBA 7(a) loan by SmartBiz offers up to 90% loan-to-value, decreasing the amount of downpayment required. You can borrow up to $5 million in 25 years with a minimum downpayment of 10% to 30%.
Lendio provides commercial SBA 504 loans for real estate, allowing you to borrow up to $14 million over 25 years.
An SBA 504 combines two mortgages where the lender provides one loan while a CDC non-profit lender offers the other.
If you want to borrow an SBA 504 loan, you must be the property owner, and your business must have a net worth of less than $15 million. Besides, the interest rate is fixed at 2.5% and 3% for the CDC portion. For the lender portion, the rate is 4% to 10%.
Wells Fargo is a good choice if you are looking for a conventional commercial mortgage. It can finance up to $1 million for 5 or 10 years. In some cases, the period can also extend to 20 years. The interest rate is 5% to 10%.
However, one noteworthy thing is that you’ll have to submit $1000 while accepting the conditional approval for a line of credit or loan. The amount is non-refundable in case your loan doesn’t close.
All companies on our list are the top providers of commercial real estate mortgages. Each one offers excellent loan products but with varying terms.
Therefore, do remember to compare different loans, conditions, and rates of different lenders. This will help you determine the costs for long-term loans and choose the one that best matches your requirements.