Commercial Property Loan Options – Finance Your Commercial Real Estate Investment

Introduction to Commercial Property Loans

Investing in commercial real estate requires specialized financing solutions that consider the income potential, property type, and borrower qualifications. Whether you're acquiring office space, retail centers, multifamily units, or industrial properties, The Mortgage Calculator offers a variety of DSCR, SBA, Non-QM, and fix-and-flip loan options to meet the needs of commercial real estate investors.

This guide covers the different types of commercial property loan options, eligibility criteria, down payment requirements, and links to helpful pages on The Mortgage Calculator website to help you secure the best financing for your commercial property investment.

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1. Conventional Loans for Commercial Properties

What Is a Conventional Commercial Loan?

A conventional commercial loan is a mortgage that follows traditional underwriting standards for financing commercial properties such as office buildings, retail spaces, warehouses, and multifamily units. These loans are ideal for borrowers with strong credit and stable financials who meet standard income and asset requirements.

Eligibility Requirements:

• Minimum credit score of 700+

• Down payment of 20-25% depending on property type

• Debt Service Coverage Ratio (DSCR) of 1.25 or higher

Loan Limits:

• Loan amounts available up to $5 million or higher, depending on the property and borrower profile

? Learn More About DSCR Loans for Commercial Properties

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2. DSCR Loans – Debt-Service Coverage Ratio Loans

What Is a DSCR Loan for Commercial Properties?

A DSCR (Debt-Service Coverage Ratio) loan allows borrowers to qualify based on the income generated by the property rather than their personal income. DSCR loans are ideal for commercial real estate investors who want to expand their portfolios without the constraints of traditional income verification.

Eligibility Requirements:

• Minimum credit score of 620-680 depending on loan amount

• DSCR ratio of at least 1.25 or higher (property’s net operating income should cover the mortgage payment)

• Down payment of 20-30% depending on property type

Eligible Commercial Property Types:

• Multifamily Properties (5+ Units)

• Office Buildings

• Retail Spaces & Shopping Centers

• Industrial Warehouses

• Mixed-Use Properties

• Self-Storage Facilities

? Learn More About DSCR Loans

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3. SBA 504 and SBA 7(a) Loans for Commercial Real Estate

What Is an SBA Loan for Commercial Properties?

SBA loans (Small Business Administration loans) are government-backed loans that provide financing for small business owners looking to purchase commercial real estate, office buildings, or industrial properties. SBA loans offer low down payment options and favorable interest rates.

SBA Loan Options for Commercial Properties:

SBA 504 Loan

• Used for the purchase, renovation, or construction of commercial real estate

• Requires 10% down payment for most borrowers

• Loan amounts available up to $5 million or higher

SBA 7(a) Loan

• Used for the purchase of existing commercial real estate

• Requires 10-15% down payment

• Loan amounts available up to $5 million

? Learn More About SBA Loan Options

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4. Non-QM Loans for Commercial Properties

What Is a Non-QM Commercial Loan?

A Non-QM (Non-Qualified Mortgage) loan offers flexible financing solutions for commercial real estate investors who may not meet traditional loan requirements. These loans allow borrowers to qualify using alternative documentation methods, such as bank statements, P&L statements, or asset depletion.

Popular Non-QM Loan Options for Commercial Properties:

• Bank Statement Loans – Qualify using 12 or 24 months of bank statements.

• P&L Mortgage Loans – Based on a CPA-prepared profit and loss statement.

• Asset-Based Loans – Qualify based on the value of liquid assets or property equity.

Eligibility Requirements:

• Minimum credit score of 600-680 depending on loan type

• Higher down payment of 20-30% depending on the property

• Flexible income documentation accepted

Eligible Commercial Property Types:

• Mixed-Use Properties

• Retail Spaces

• Warehouses and Industrial Properties

• Office Buildings

• Self-Storage Facilities

? Learn More About Non-QM Loans

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5. Fix-and-Flip Loans for Commercial Properties

What Is a Fix-and-Flip Loan?

A fix-and-flip loan is a short-term financing option for real estate investors who purchase, renovate, and sell commercial properties for profit. These loans are ideal for borrowers looking to improve distressed commercial properties and quickly sell them for a higher price.

Eligibility Requirements:

• Minimum credit score of 620+

• Down payment of 20-25%

• Experience in commercial real estate investing preferred

Loan Limits:

• Loan amounts available up to 85% of the purchase price and 100% of renovation costs

? Learn More About Fix-and-Flip Loans

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6. Bridge Loans for Commercial Properties

What Is a Bridge Loan?

A bridge loan provides short-term financing that allows investors to secure funding quickly while waiting for long-term financing or selling an existing property. These loans are commonly used for commercial real estate purchases, property improvements, or refinancing projects.

Eligibility Requirements:

• Minimum credit score of 620+

• Loan-to-Value (LTV) ratio up to 75%

• Short-term repayment terms (usually 6-24 months)

? Learn More About Bridge Loans

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7. Hard Money Loans for Commercial Properties

What Is a Hard Money Loan?

A hard money loan is an asset-based loan that uses the commercial property as collateral rather than relying on the borrower’s credit history. These loans are typically used by commercial real estate investors who need fast access to capital for property acquisition or improvements.

Eligibility Requirements:

• Minimal credit requirements

• Higher down payments (typically 25-35%)

• Short-term financing with interest-only payments

Eligible Commercial Property Types:

• Office Buildings

• Mixed-Use Properties

• Industrial Facilities

• Multifamily Properties

• Retail Spaces

? Learn More About Hard Money Loans

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8. Jumbo Loans for High-Value Commercial Properties

What Is a Jumbo Loan?

A jumbo loan is a mortgage that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac. These loans are commonly used to finance luxury commercial properties or high-value investment projects that exceed conventional loan limits.

Eligibility Requirements:

• Minimum credit score of 700+

• Down payment of at least 20-30%

• DTI ratio under 45%

Loan Limits:

• Loan amounts typically exceed $5 million depending on the property type and location

? Learn More About Jumbo Loans

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9. Cash-Out Refinance for Commercial Properties

What Is a Cash-Out Refinance?

A cash-out refinance allows commercial property owners to tap into the equity of their existing properties and reinvest that capital into additional investments or improvements.

Eligibility Requirements:

• Minimum credit score of 620+

• Loan-to-Value (LTV) ratio of 70-75%

• Ownership of the property for at least 6 months

? Learn More About Cash-Out Refinance Options

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Apply for a Commercial Property Loan Today

Whether you’re purchasing a new commercial property, refinancing an existing building, or seeking a cash-out refinance, The Mortgage Calculator offers a variety of loan programs to meet your needs. Our team of mortgage experts can guide you through the financing process and help you secure the best loan option for your commercial real estate investment.

? Start Your Application Now

 

Frequently Asked Questions About Reconsideration of Value (ROV):