Commercial Real Estate Financing

The most common CRE loan types include: Bridge loans (short-term, 12–36 months for transitional assets), CMBS loans (securitized, fixed-rate for stabilized properties), SBA 504 loans (government-backed for owner-occupied properties), Agency debt (Fannie Mae/Freddie Mac for multifamily), Bank term loans (portfolio lenders offering flexible structures), Mezzanine financing (subordinated debt for higher leverage), Construction loans (for ground-up or heavy renovation), and Preferred equity (hybrid capital that sits between debt and common equity).

Most commercial lenders offer loan-to-value (LTV) ratios between 65% and 80%, depending on asset type, property condition, and borrower experience. Stabilized multifamily and industrial assets can achieve higher leverage (up to 80% LTV), while transitional or hospitality properties typically max at 70–75% LTV. At Rad Capital Group, we arrange financing from $4 million to $500 million across all major asset classes.

CRE loan interest rates vary by loan type, property type, leverage, and market conditions. As of 2025–2026, typical ranges are: Agency multifamily (5.5%–7.0%), CMBS fixed-rate (6.0%–7.5%), Bank term loans (6.5%–8.5%), Bridge loans (8.0%–12.0%), and Mezzanine/Preferred equity (10%–15%). Rates are influenced by Treasury yields, SOFR, and lender-specific credit criteria. We help borrowers secure the most competitive terms by distributing to 150+ active lenders simultaneously.

Closing timelines depend on the loan type: Bridge loans can close in 2–4 weeks, bank term loans typically take 45–60 days, CMBS and Agency loans may require 60–90 days, and SBA 504 loans often take 75–120 days. Our in-house underwriting and direct lender relationships allow us to deliver initial term sheets within two weeks and significantly accelerate the overall timeline.

Lenders typically require: trailing 12-month profit & loss statements, current rent roll, property tax statements, insurance certificates, borrower personal financial statement, schedule of real estate owned, operating agreements or entity documents, and an appraisal (usually ordered after term sheet acceptance). Our Deal Portal streamlines document collection with a guided checklist and secure upload system.

Debt-Service Coverage Ratio (DSCR) measures a property's ability to cover its debt payments. It's calculated by dividing Net Operating Income (NOI) by annual debt service. Most lenders require a minimum DSCR of 1.20x–1.35x, meaning the property generates 20%–35% more income than needed to cover loan payments. A higher DSCR indicates lower risk and can help secure better rates and terms.

Yes, though options may be limited. Bridge lenders, debt funds, and private lenders focus more on the property's cash flow and collateral value than borrower credit scores. While traditional bank and agency lenders typically require 680+ credit scores, alternative lenders may work with borrowers who have credit challenges, prior bankruptcies, or limited experience — often at higher interest rates and lower leverage.

Recourse loans allow the lender to pursue the borrower's personal assets if the property's value doesn't cover the debt upon default. Non-recourse loans limit the lender's recovery to the property itself, with standard carve-outs for fraud, misrepresentation, and environmental liabilities. CMBS and Agency loans are typically non-recourse, while bank and bridge loans may require personal guarantees.

A skilled CRE mortgage advisor provides access to a broader network of lenders (banks, insurance companies, debt funds, CMBS, and agency), in-house underwriting that strengthens your loan package, competitive bidding across multiple capital sources, expertise in complex deal structures, and significant time savings. At Rad Capital Group, we maintain 200+ direct lender relationships and handle the entire process from underwriting through closing.