Commercial real estate financing is not one market; it is several, and the property in front of you decides which one you are in. The same borrower can be a strong candidate for an SBA 504 purchase, a routine bank customer on a stabilised building, and a hard-money client on a transitional one — because lenders are not really pricing you first. They are pricing the property’s occupancy, condition and cash flow, and then checking whether you can carry what the property cannot. This hub routes you in that order: what are you buying or refinancing, will your business occupy it, is it stabilised or transitional, and how much cash is actually available? Answer those four and the loan type mostly selects itself. LessOwe sells nothing and takes no lender commissions; the pages below exist to make the routing honest.
General information, not financial advice. Rates, limits and program figures cited across this cluster are attributed snapshots as of the dates shown on each page; your lender’s term sheet controls your deal.
Occupancy is the sharpest dividing line in small-balance commercial real estate, because one major program family exists only on one side of it.
Getting this fork wrong wastes weeks: borrowers regularly ask SBA lenders to finance buildings they intend to rent out, and ask conduit lenders about properties only their own business will ever occupy.
The complete map — who lends each product, its term and amortisation, leverage, recourse and best use — is the comparison in types of commercial real estate loans.
Every product in this cluster runs the property through the same family of tests (definitions per the OCC’s Comptroller’s Handbook — Commercial Real Estate Lending):
A lender sizes to the lowest maximum those tests produce, then applies borrower, lease, property and market judgement on top. How commercial lenders evaluate your loan walks one property through all three tests with a single consistent set of figures, and the commercial mortgage calculator runs the same math on your own deal — payment, balloon, LTV and an optional DSCR and debt yield from NOI.
Passing the property math is necessary, not sufficient. The lender then tests you: post-closing liquidity (can you survive a vacancy or a slow quarter?), net worth relative to the loan, credit history, experience with this property type, and — at this end of the market, almost always — a personal guarantee from the principal owners. Weakness in any of these can shrink the loan the property alone would have supported, which is why the requirements checklist treats borrower readiness as half the file rather than paperwork afterthought.
If you have a property and a price, start with the calculator — the payment and the balloon frame every later conversation. If you have a property type but no deal yet, start with the occupancy fork above and the types comparison. If you already hold a term sheet, go to how lenders evaluate your loan and check the numbers the lender is computing about you. And if the file is not ready — documents scattered, equity unclear — the requirements checklist is the honest first step.
What is commercial real estate financing? It is debt secured by income-producing or owner-occupied business property — offices, retail, industrial, multifamily and speciality buildings. Unlike residential lending, underwriting centres on the property’s own cash flow (its NOI) alongside the borrower’s strength, and loans are typically structured with a term shorter than their amortisation, leaving a balloon balance at maturity.
How much down payment is required? It depends entirely on the product: as little as 10% on a qualifying SBA 504 owner-occupied purchase, commonly 20–30% for conventional bank financing, and 25–35% or more for CMBS and some bridge or hard-money structures. Each of those bands is product- and source-specific — the attributed breakdown is in commercial property down payment.
What is DSCR? The debt service coverage ratio: a property’s net operating income divided by its annual debt service. A DSCR of 1.25× means the property produces $1.25 of NOI for every $1.00 of loan payment. Lenders set minimum DSCR floors by product and property type, and the ratio is one of the three tests that size your loan.
Are personal guarantees typically required for commercial real estate financing? At the small and mid-balance end, usually yes: bank, SBA and most portfolio lenders require owners with significant stakes to guarantee the loan personally, and SBA rules require guarantees from 20%+ owners. The main exception is CMBS and other institutional non-recourse financing, where the lender’s remedy is generally the property — subject to “bad-boy” carve-outs that restore personal liability for fraud, misappropriation and similar acts, as CMBS loans explains.
How much do I need to put down on a commercial real estate loan? Start from the product, not a rule of thumb: identify whether the deal is owner-occupied or investment, stabilised or transitional, then read the down-payment band for that product in the down payment guide — and budget closing costs, reserves and immediate repairs on top of the deposit, because the down payment alone is never the full cash-to-close.
General information, not financial advice. Sources: shared fact bank, LessOwe cluster 1.3 research (2026-10-23) — underwriting definitions and supervisory LTV limits per the OCC Comptroller’s Handbook, Commercial Real Estate Lending; SBA 504 occupancy and contribution rules per 13 CFR §§120.131, 120.870, 120.910; down-payment and rate bands attributed on their own pages. Currency verified 2026-10-23.