Commercial Property Investment Loans

Key Factors That Impact Your Rate

Property Type

Different asset classes carry different risk profiles.

Property Type Pricing :

• Multifamily (5+ Units): From 5.25%

• NNN Single Tenant: From 5.75%

• Industrial / Warehouse: From 6.25%

• Office / Retail / Special-Use: From 6.25%

• Short-Term/Bridge: From 9%

• Mobile Home Park: From 5.75%

Loan-to-Value (LTV)

• Lower leverage = better pricing

• 60–65% LTV → strongest execution

• 70–75% LTV → rate adjustments apply

DSCR (Debt Service Coverage Ratio)

• Stronger cash flow = lower risk

• 1.30+ DSCR → best pricing

• 1.20–1.29 → mid-range

• 1.15–1.19 → pricing premiums apply

Credit Score

• 740+ FICO → strongest execution

• 700–739 → moderate pricing impact

• 660–699 → higher rates and stricter terms
  (680 typically minimum)

Cash Reserves

• More liquidity improves pricing

• 6–12 months PITI preferred

• Minimum reserves may result in higher rates or interest escrows

Occupancy

• Stabilization drives pricing

• 90%+ occupied → best rates

• 80–89% occupied → mid-range pricing

• <80% occupied → higher rates or bridge structure

Term Length

Loan term directly impacts rate and flexibility.

Term Option Pricing Impact:

• 5 Year Fixed Interest Rate: Best Pricing Available

• 10 Year Fixed Interest Rate: Slight Increase in pricing

• 12-24 Month Bridge: Significant increase in pricing

Investor Capital Source

The source of capital significantly affects pricing, documentation, and flexibility.

Capital Source Rate & Structure Characteristics:

• Institutional Capital: Lowest rates, strict underwriting, stabilized assets

• Private Capital: Higher rates, flexible terms, transitional or value-add assets

Why Investors Use Commercial Loans

• Flexible term and amortization options

• Asset-based underwriting

• Scalable for larger acquisitions

• Capital options for both stabilized and transitional assets