Commercial real estate loan rates in 2026

Interest rates for commercial real estate (CRE) loans range from as low as 6% for some conventional bank and SBA-backed loans, to 15% or more for hard money loans. 

If you don't want to rent your commercial space or can't find a space that fits your needs, buying a property may be the next logical step. A commercial real estate loan can help you finance that property. Instead of paying rent, you’ll pay back the loan and (hopefully) build equity at the same time.

This guide breaks down current commercial real estate loan rates by loan type and term, what actually moves those rates, how lenders decide your price, and what you can do to position yourself for the best rate available to you.

Current commercial real estate loan rates

The interest rates below are based on federal benchmark data and lender-reported pricing. Because commercial loan rates move with the market, confirm current pricing with a lender or compare business lending options through Nav’s loan marketplace before you apply. 

Rates are current as of August 13, 2026, based on federal benchmark data and lender-reported pricing. Because commercial rates move with the market, confirm current pricing with a lender or compare options through Nav's marketplace before you apply.

What affects commercial loan rates?

Commercial lending rates often start with a benchmark or index rate. On top of that the lender adds its spread, and prices the loan for the level of risk of both the property and the borrower. Popular indexes are:

Note: The prime rate changes with Federal Reserve announcements, the SBA Optional Peg Rate is published quarterly in the Federal Register and the other rates can change frequently. 

Commercial real estate loan rates by loan type

SBA 504 loan rates

SBA 504 loans are designed to spur economic development. They're long-term financing options — 10, 20, or 25 years — for fixed assets that help you acquire, modernize, or expand a business, or refinance costs tied to that kind of expansion. They're often called CDC loans, named for the Certified Development Companies that make them available.

A 504 loan can generally fund project costs up to $5 million and cover up to 90% of total project costs. The structure is split three ways: the CDC portion, backed by the SBA, covers up to 40% of the loan; the participating lender covers 50%; and you cover the remaining 10 — 15% as a down payment. That's a lower down payment than most other commercial real estate loans require, and rates are competitive as well. 

504 loan rates

SBA 7(a) loan rates

SBA 7(a) loans are another popular option for small business owners financing construction, renovations, modernizations, or long-term equipment purchases. Funds can also cover equipment, inventory, and fixtures, plus working capital, debt refinancing, and startup costs — making 7(a) more flexible than a 504 loan.

The SBA doesn't set 7(a) rates directly. Instead, it caps how much a lender can charge on top of a base rate, and that cap shrinks as the loan amount grows

Tip: Eligible borrowers may combine both a 7(a) and 504 loan for a total of $10 million.

7(a) variable rate ceilings

7(a) fixed rate ceilings

Based on the current 6.75% prime rate, that puts maximum 7(a) rates anywhere from 9.75% to 14.75%, though many borrowers qualify for less than the maximum [S1][S6]. Loan terms used for real estate purchases can run up to 25 years, longer than the 5- to 10-year terms typical for working capital or equipment.

Conventional bank commercial mortgage rates

Banks and credit unions also offer commercial real estate loans, also known as commercial mortgages. Unlike SBA programs, conventional loan rates aren’t capped by a federal formula. It's set by market conditions and qualifications, including the property and your credit profile.

Current estimated commercial bank real estate loans

Commercial bridge loan rates

A bridge loan is short-term financing that helps you close on a property before you've lined up permanent financing, or while a property transitions from one use to another. Bridge loans typically run 12 to 36 months and carry interest-only payments, meaning your monthly payment covers interest only, with the principal due at the end of the term.

Reported 2026 bridge loan rates range from about 7.75% for the strongest borrowers up to roughly 14.5% depending on leverage and deal risk. That's higher than SBA or conventional bank pricing, but the tradeoff is speed: bridge lenders can close faster and work with properties that don't yet qualify for permanent financing. 

If you can wait for a bank or SBA loan to close, you'll typically pay less. Bridge financing is a tool for when timing matters.

Current estimated bridge loan rates

Hard money loan rates

Hard money loans are asset-based: the lender is primarily underwriting the property, not your personal or business financials. That makes them useful when you need to close quickly or don't yet meet a bank's documentation requirements, but it also means you'll pay for that flexibility. Reported hard money rates for commercial properties run from about 10% to 14%.

Hard money can make sense for properties you will renovate and sell quickly, or as a short-term bridge to a lower-cost refinance, but not as permanent financing.

Current estimated hard money loan rates

Commercial construction loan rates

Construction loans fund a property that doesn't exist yet or isn't finished, so lenders price in more risk than they would for a stabilized, income-producing asset. Like bridge loans, construction loans are typically interest-only during the build, with funds released in draws as work is completed and inspected. Once construction wraps up, the loan either converts to permanent financing or gets refinanced into one.

Reported 2026 construction loan rates generally price above standard commercial mortgage rates because of that added risk.

Current estimated commercial construction loan rates

Commercial mortgage rates by term

The loan term and amortization period aren't always the same. The term is how long you have before the loan is due in full; the amortization period is how long your payments are calculated as if you were paying off the loan. When those two don't match, you get a balloon payment — a lump sum due at the end of the term to pay off whatever principal is left.

SBA 504 and 25-year SBA 7(a) real estate loans are fully amortizing, meaning there's no balloon payment — your loan is paid off entirely by the end of the term. Conventional bank loans more often carry a shorter balloon term, even when the payment is calculated over a longer amortization schedule, so you'll want to confirm with your lender when the balance comes due.

Commercial real estate loan requirements

Lenders look at a variety of factors depending on the property and the type of the loan. 

• Property value and use. Since the property secures the loan, the lender evaluates it directly to gauge how your requested loan amount compares to the property's value. They will take into account how the property will be used to evaluate the value. 
• Business finances. Your ability to repay debt is often a primary factor in loan eligibility. Lenders may look solely at the property to measure this for some loans. For others, they may look at revenue, outstanding debt, and business credit scores. They may also for up to five years of tax records, financial documents, a business plan, proof of business structure, and projected cash flow.
• Personal finances. Even for a business loan, your personal credit scores matter. High credit scores, or a credit profile free of bankruptcies and liens, can work in your favor. If your personal credit is low, improving it before you apply can help your approval odds and your rate.

One requirement worth calling out: the rule that you must occupy 51% of the property applies to owner-occupied financing, including SBA loans. It doesn't apply to investment-property loans, which are underwritten based on the property's own cash flow rather than owner occupancy.

Since your personal and business credit both factor into approval and pricing, it's worth knowing where you stand before you apply. Check your business credit scores with Nav to see how lenders are likely to view your file.

What is loan-to-value ratio (LTV)

Loan-to-value ratio, or LTV, is one of the ratios lenders evaluate risk on a commercial real estate loan. To determine your LTV, the lender divides the requested loan amount by either the property's purchase price or its appraised value, whichever is lower.

For example, if you requested a $350,000 loan for a $500,000 property, your LTV would be 70%.

The lower the LTV, the lower the risk to the lender. That can translate to better rates. Commercial loans typically carry lower maximum LTVs than residential mortgages, since some residential loans can be approved with LTVs up to 100%.

Debt-service coverage ratio

The debt-service coverage ratio, or DSCR, helps lenders determine whether you can realistically make your monthly payments. To calculate it, the lender compares your property's annual net operating income (NOI) to your annual loan payment, including both interest and principal — also called the mortgage debt service.

To find your NOI, subtract your annual operating expenses from your annual revenue. To calculate DSCR, divide NOI by annual debt service.

For example, if the NOI is $210,000 and your annual loan payments total $130,000, your DSCR would be 1.6.

In general, your DSCR shouldn't dip below 1, since that would indicate negative cash flow and an inability to fully repay the debt.

Fees and other costs

Your interest rate isn't the only cost that affects how much a commercial real estate loan costs you. Before you commit, look for these common fees:

• Appraisal fees
• Origination fees
• Survey fees
• Legal fees
• Closing costs
• Loan application fees

It's also worth checking whether your loan carries a prepayment penalty, which will cost you money if you want to pay it off ahead of schedule or even refinance. If it does, understanding the type and duration can help you plan your repayment strategy. 

SBA 504 loans, for example, carry a relatively small prepayment penalty that decreases incrementally over time, while other loans may carry a single penalty that applies for a set number of years.

Estimating payments with a commercial loan calculator

Before you commit to a loan, it helps to run the numbers across a few different scenarios — loan amount, term, interest rate, and fees — to see what's actually affordable on a monthly basis and over the life of the loan.

As an example, a $500,000 loan at 6.845%, the current median rate for a conventional bank fixed-rate term loan, amortized over 20 years, works out to a monthly payment of roughly $3,830 in principal and interest. Your actual payment will depend on your rate, term, and loan amount, so use Nav's business loan calculators to estimate your own numbers before you apply.

How to get the best commercial real estate loan rate

A few concrete steps can improve the rate you're offered:

• Strengthen your credit before you apply. Personal credit and/or business credit may be evaluated, so address any issues ahead of time rather than after a lender pulls your file.
• Lower your LTV with a larger down payment. Since a lower LTV signals less risk to the lender, putting more down upfront can help you qualify for a better rate.
• Document your cash flow to lift your DSCR. Clean, organized financials that show strong net operating income relative to your debt service make your file easier to approve — and easier to approve at a lower rate.
• Quote multiple lender types. SBA lenders, conventional banks, and alternative lenders all price differently. Comparing several before you commit gives you leverage and a clearer sense of what you actually qualify for.
• Consider an SBA loan for owner-occupied property. SBA 504 and 7(a) loans often come with lower rates and smaller down payments than conventional bank financing, if your business will occupy the property.

Compare commercial loan options through Nav's marketplace to see what you're likely to qualify for.

Frequently asked questions