Commercial Real Estate Loans: Best Options and How to Get One
Commercial real estate loans help you buy, refinance or renovate commercial property by providing flexible payment terms and low interest rates.
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| Lender | NerdWallet rating | Best For | Max loan amount | Min. time in business | Min. interest rate | Term length | Learn more |
|---|---|---|---|---|---|---|---|
 with Fundera by NerdWallet | Read expert review | borrowers who can't qualify for bank financing | $5,000,000 | 24 months | 9.75% | Up to 25 years | with Fundera by NerdWallet |
with Fundera by NerdWallet | Read expert review | borrowers who want low interest rates | $5,000,000 | 24 months | 5% | 10 to 25 years | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | borrowers who need money fast | $500,000 | 24 months | 22.45% | 6 months to 5 years | with Fundera by NerdWallet |
 | larger businesses with strong finances | $10,000,000 | Undisclosed | Undisclosed | Up to 10 years | ||
 | Read expert review | smaller businesses with strong finances | Undisclosed | 24 months | Undisclosed | Up to 15 years |
commercial real estate loans: More details
U.S. Small Business Administration: Best for borrowers who can't qualify for bank financing
Low interest rate
SBA 7(a) loan
with Fundera by NerdWallet
Max loan amount
$5,000,000
Min. credit score
650
Term length
Up to 25 years
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
with Fundera by NerdWallet
U.S. Small Business Administration: Best for borrowers who want low interest rates
SBA CDC/504 loan
with Fundera by NerdWallet
Max loan amount
$5,000,000
Min. credit score
680
Term length
10 to 25 years
Pros
- Low down payment required.
- Repayment terms of up to 25 years.
- Competitive interest rates.
Cons
- Must meet job creation or public policy goals to qualify.
- Longer processing times than online lenders.
Pros
- Low down payment required.
- Repayment terms of up to 25 years.
- Competitive interest rates.
Cons
- Must meet job creation or public policy goals to qualify.
- Longer processing times than online lenders.
with Fundera by NerdWallet
iBusiness Funding: Best for borrowers who need money fast
May fund quickly
iBusiness Funding - Online term loan
with Fundera by NerdWallet
Max loan amount
$500,000
Min. credit score
660
Term length
6 months to 5 years
Pros
- Cash can be available within two business days.
- Competitive rates among online lenders.
- Terms up to five years.
- iBusiness Funding also offers SBA loans up to $5 million.
Cons
- Charges an origination fee.
- Must be in business for a minimum of 24 months.
- Minimum credit score is higher than some other lenders.
Pros
- Cash can be available within two business days.
- Competitive rates among online lenders.
- Terms up to five years.
- iBusiness Funding also offers SBA loans up to $5 million.
Cons
- Charges an origination fee.
- Must be in business for a minimum of 24 months.
- Minimum credit score is higher than some other lenders.
with Fundera by NerdWallet
TAB Bank: Best for larger businesses with strong finances
TAB Bank - Commercial real estate loan
Max loan amount
$10,000,000
Min. credit score
700
Term length
Up to 10 years
Pros
- Large loan amounts available.
- Construction financing is also available.
Cons
- Large down payment likely required.
- Personal credit score of 700 or higher required.
Pros
- Large loan amounts available.
- Construction financing is also available.
Cons
- Large down payment likely required.
- Personal credit score of 700 or higher required.
Bank of America: Best for smaller businesses with strong finances
Bank of America - Commercial real estate loan
Max loan amount
Undisclosed
Min. credit score
700
Term length
Up to 15 years
Pros
- Discounts for Preferred Rewards for Business members and U.S. veterans.
- Options for balloon or fully amortized loans.
- Can be used to refinance an existing commercial real estate loan.
Cons
- Added fees may drive up the total cost of the loan.
- Application must be completed over the phone or in-person.
Pros
- Discounts for Preferred Rewards for Business members and U.S. veterans.
- Options for balloon or fully amortized loans.
- Can be used to refinance an existing commercial real estate loan.
Cons
- Added fees may drive up the total cost of the loan.
- Application must be completed over the phone or in-person.
What is a commercial real estate loan?
A commercial real estate loan is a type of commercial loan used to buy, refinance or renovate a property that’s used for business, like office buildings, storefronts or restaurants. They can also be used to finance investment properties like apartment buildings or commercial spaces to be leased out, or to build commercial properties.
Types of commercial real estate loans
| Loan type | Overview |
|---|---|
| Commercial mortgage loan | Standard loans used to purchase or refinance commercial property. Similar to residential mortgage loans, but usually have shorter terms and higher down payment requirements. |
| Short-term financing used to take advantage of an immediate opportunity and cover the gap until you can find a long-term option. | |
| These loans finance the construction of new commercial buildings or major renovations. | |
| Partially guaranteed by the SBA and issued by participating lenders, these loans offer up to $5 million and repayment terms of up to 25 years. | |
| Specifically designed for large fixed asset purchases (like real estate), these loans are made up of three parts: Bank loan (50%), Certified Development Company loan (40%) and borrower down payment (10%). | |
| Debt service coverage ratio (DSCR) loans help real estate investors buy income-generating properties, like office buildings or multi-unit properties that they can quickly start renting out. | |
| Short-term loan that allows real estate investors to quickly fix up a home with the goal of reselling it shortly after for a profit. | |
| Typically offered by private investors or lenders, these short-term, often expensive loans are issued based on the value of your collateral, as opposed to more traditional loan requirements. |
» MORE: SBA real estate loans
How do commercial mortgages work?
Commercial real estate loans function a lot like personal mortgages. They are term loans that you repay over a set period of time, with interest, and are usually secured by the property being financed.
Many real estate loans, however, are structured as balloon mortgages. With these small-business loans, the amortization period, the time it takes to fully pay off the loan plus interest, is longer than the repayment term. Balloon mortgages are more commonly found in commercial real estate loans than consumer mortgages.
Balloon loans essentially limit the amount of cash you need upfront to purchase a property, and lower your monthly payments. However, at the end of the loan term, the remaining balance of the loan, or the “balloon” payment, is due.
Repayment terms on commercial property loans generally range anywhere from five to 25 years. But it largely depends on the type of loan, the property, your lender's business loan requirements and other factors.
Interest rates on commercial mortgage loans range from about 5% to 14%. Like with repayment terms, your exact rate will depend largely on the lender, the type of loan, the value of the property you’re financing, and your business’s qualifications.
Commercial mortgages tend to have more fees than other types of business loans. Commercial real estate lenders may charge origination fees, loan application fees, property appraisal fees, legal fees and other closing costs. Plus, if you try to pay your mortgage off early, you’ll likely be charged a prepayment penalty.
Commercial real estate loan requirements
📈 Personal finances
Most commercial loans from traditional lenders like banks factor your personal income, personal assets and credit score into their underwriting decision. Ideally, you should have minimal debt and a decent credit score before you apply for a commercial mortgage, as you would for a personal mortgage. At the very least, a review of your personal financial situation will help you going into the process.
💰 Down payment
Many lenders want to know that you have vested interest in a commercial real estate loan, and will ask for you to put a percentage of cash down. The amount of the required down payment, or equity injection, will vary depending primarily on the lender and your business financials. Most lenders require at least 20% as a down payment.
⏱️ Time in business
Lenders want to make sure your business is established with revenue trending upward before granting a commercial mortgage. Most require at least two years in business, but some want to see as many as four years.
🏠 Collateral
Commercial real estate loans are typically secured business loans. This means they’re backed by specific collateral, in this case, the property you own or want to buy. Depending on the lender and the loan program you use, a lien may be attached to the property and your business may need to occupy a certain percentage of the building. For example, the SBA typically requires that the business occupy at least 51% of the space.
Where to get a commercial real estate loan
- Banks and credit unions. Banks and credit unions, like Bank of America, PNC and U.S. Bank, offer commercial real estate loans for both owner-occupied real estate and investment properties. Depending on the bank and your specific qualifications, banks and credit unions typically offer the most competitive interest rates and terms. However, they also have some of the most stringent qualification requirements. Typically, you’ll need multiple years in business, strong personal credit and strong business financials.
- SBA lenders. Both SBA 7(a) and SBA 504 loans can be used to finance commercial real estate. They offer maximum loan amounts up to $5.5 million, terms up to 25 years, competitive interest rates and down payment requirements as low as 10%. To qualify for an SBA real estate loan, you’ll need strong personal credit and business finances, as well as at least two years in business.
- Online lenders. Online business lenders usually have less stringent qualification requirements and offer high loan amounts, streamlined applications and faster funding than traditional lenders; however, they also typically come with higher rates and fees. They are a good option if you can’t qualify for a commercial mortgage with a traditional lender.
- Community development financial institutions (CDFIs). CDFIs are bank or nonbank lenders with a mission to support underserved communities. Some provide commercial real estate loans and may help borrowers who don’t qualify for traditional financing.
How to get a commercial real estate loan
Specific requirements vary based on your business’s specific needs, the type of lender you choose and your business’s qualifications. You can generally expect to follow these steps:
1. Review your personal finances
Most commercial mortgage lenders will take your personal finances into consideration, and some require a personal guarantee. Personal finances include personal assets, personal income and credit score. The better your personal finances, the more likely you are to qualify for the best rates and terms.
2. Assess your available cash for a down payment
A commercial real estate lender will likely require a down payment, though the amount you are required to put down will vary based on the lender and your eligibility. Down payments reduce the amount you need to borrow, and they show that you have skin in the game, which lenders like.
3. Research and compare lenders
Consider your specific financing need — new purchase, construction or refinance — and assess your business’s basic qualifications to help determine which type of lender is best for your business. You may use your business bank as a starting point for your research.
4. Gather documents and apply
Each lender has its own list of required documents. Generally, you can expect to provide business and personal tax returns and bank statements, business legal documents, insurance information and other details about the property, including an appraisal.
Commercial real estate loan calculator
Trying to figure out if getting a commercial mortgage is right for your business? Use our commercial real estate loan calculator to estimate monthly payments, interest costs, balloon payments and more.
Last updated on January 5, 2026
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If the lender approves you, you’ll sign closing documents in order to receive funds. Some lenders can approve and fund loans within one business day.
Methodology
NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including:
- Transparency of rates and terms.
- Flexible payment options.
- Fast funding times.
- Accessible customer service.
- Reporting of payments to business credit bureaus.
- Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
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