Loan Type:

Commercial loans are loans that are used to finance the purchase or refinance of commercial real estate properties, such as office buildings, retail centers, and warehouses.

Eligibility:

To qualify for a commercial loan, borrowers typically need to have a strong credit history, sufficient cash flow to repay the loan, and a significant amount of equity in the property.

Loan Amount:

The loan amount for a commercial loan is based on the appraised value of the property, as well as the borrower’s financial and credit profile.

Repayment:

Commercial loans may have a variety of repayment structures, including amortizing loans (where the principal and interest are paid over time) and balloon loans (where a large payment is due at the end of the loan term).

Interest Rates:

Commercial loan interest rates vary depending on the borrower’s creditworthiness, the loan-to-value ratio, and the type of loan. Rates may be fixed or variable.

Fees:

Commercial loans may have upfront fees, such as application fees, appraisal fees, and closing costs, as well as ongoing fees, such as servicing fees and late payment fees.

Documentation:

Commercial loans typically require more documentation than residential loans, including detailed financial statements, tax returns, and business plans.