E. T. Hobbs asked:


Real Estate Commercial Loans

What is a Real Estate Commercial Loan?

A real estate commercial loan is a form of mortgage loan used to buy, renovate, or refinance commercial buildings or land zoned for commercial or mixed use.

How Do I Get a Commercial Loan For Real Estate?

You may want to be pre-qualified by a commercial mortgage broker who can find you the best terms and rates for your commercial real estate loan. Conduct a search for “real estate commercial loans”, “real estate commercial loan”, “commercial loan real estate” and you are sure to find and endless number of possibilities to choose from.

What Can I Use a Real Estate Commercial Loans For?

Real estate commercial loans can be used for purchasing land and making necessary improvements includuing grading, utilities, parking lots, and landscaping. These loans can also be used for the purchase, construction, or renovation of commercial buildings or land.

What Terms and Interest Rates and Fees Can I Expect From a Real Estate Commercial Loan?

Interest rates on commercial real estate loans are based on an increment above the current market rate for five-year and 10-year U.S. Treasury bonds. Maturities can be 10, 15, 20, or 30 years. Many commercial real estate loans require a bollon payment after 10 years. You may want to consider refinancing at that time or get a loan that does not require a balloon payment. Fees on commercial mortgage loans usually total approximately three 3% of the borrowed amount.

What Are the Qualifications For a Commercial Loan For Real Estate?

To qualify for a commercial real estate loan, you must have enough liquid assets to pay a down payment and closing costs. Down payments on a commercial real estate purchase can go as low as 3%. There is no down payment requirement for a commercial loan refinance.

Are There Loan Limits For a Real Estate Commercial Loan?

Loan limits on commercial real estate loans differ from lender to lender. They start as low as $50,000 and can go as high as $50-$100 million.

Where Can I Find a Real Estate Commercial Lender?

It’s relatively easy to find commercial lenders and commercial mortgage brokers online.       A good place to start looking for a commercial real estate lender is online. Do a search for: “real estate commercial lending”, “real estate commercial lenders”, “real estate commercial bank”

Are There Any Government Programs to Help Me Get a Real Estate Commercial Loan?

The U.S. Small Business Administration (SBA) works with lenders and non-profit corporations to provide commercial loans to small businesses through the CDC/504 Program.The CDC/504 Program provides small businesses with long-term, fixed-rate commercial loans for major assets, such as land and buildings. A Certified Development Company (CDC) is a nonprofit corporation set up to assist in the economic development of a particular communities. Each CDC covers a specific geographic area.



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jeff rauth asked:


We get a lot of questions regarding the commercial loan business.  Many are from our peers that want our opinions on the commercial loan business. 

Warren Buffet was on the radio this morning.  He stated “when the markets greedy, be fearful.  When the markets fearful, you be greedy.”  I think we can all apply that perspective on our positions in the commercial loan business.  In a few years, the credit crisis will have settled.  The commercial loan business will be different, but it will still be viable.  There will be more government regulation for sure and probably more intense review of the credit rating agencies out there, like moody’s etc. 

Perhaps there will be a new type of loan structure replacing the current CMBS platform, but the players that pulled out will be kicking themselves as they see their competition making serous money and they will still be learning the “ropes” of their new chosen field.  The survivors will make big headway in market share.We believe that the problems can and will be fix.  This is just another recession in a long list of them.  We go through this every 10 to 15 years.  Now is the time to adapt and refine your skills – not the time to pull out.  We tend to think a lot about what is still funding. 

What lenders and banks are still looking at deals?  Never mind what the borrower wants or thinks he should get.  It’s more an attitude of take it or leave it. 

The commercial loan business is still moving forward, with a limp for sure, but it’s still moving forward.  For example we are still closing loans.  Both owner occ and investment.    

This is the time people build substantial wealth as they pick up bargain opportunities or take chunks of market share that just wouldn’t be possible during normal times.   



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