Check out our best commercial mortgage rates for September 16, 2024. We are your commercial mortgage lending leaders with over 30 years of experience. Our platform provides real-time updates on various loan products, aiding investors and business owners in the commercial real estate market. Recently, the 10-year and 5-year treasury yields have impacted commercial mortgage rates significantly. Analyzing the trends in treasuries and the Federal Reserve's monetary policy can give insights into potential future rate movements, offering valuable foresight on the trajectory of rates. As of September 16, 2024, the 5 year Treasury is at 3.405% and the 10 year is at 3.623%.
Current Events Affecting Commercial Mortgage Rates
Commercial mortgage rates in 2024 continue to remain volatile
Coming into the year, many investors were hopeful that commercial mortgage rates would come down in 2024. However, rates have steadily increased throughout Q1 of 2024. On January 1st, the 10-year treasury sat at 3.86%. By mid-April, the 10-year treasury had increased to around 4.50%. As inflation has not come down enough for the Fed to cut rates, the central bank has put their plans to lower rates in 2024 on hold for the foreseeable future. That announcement has caused commercial mortgage rates to continue to rise as the months pass. Sitting at 8.5%, the prime rate is the highest it has been in over 20 years. Today’s much higher rates are making borrowing much more costly for individuals, small businesses, and commercial real estate investors. With a larger portion of their cash flow being used to cover higher commercial mortgage payments, investors are finding it hard to remain profitable. Many retail and office buildings are subject to longer term leases, making rental rate increases hard to implement. As such, many properties today are facing intense pressure to stay cash positive. Many billions of dollars of commercial mortgage loans are set to mature in 2024 and owners are facing tough times refinancing this debt at today’s much higher commercial mortgage rates. We are already seeing some investors default on their loans, and we expect to see the foreclosure rate increase as more and more investors are unable to refinance maturing debt.
What impact will the collapse of SVB and Signature Bank have on multifamily loans?
We don’t expect the multifamily sector to be affected by these recent closures unless the banking crisis expands and causes other banks to be closed down. These banks were affected by business lending in the tech and cryptocurrency sectors. Multifamily lending for banks has overall been healthy and we don’t expect that to change any time soon. However, we are seeing lending activity slow down as rates have risen due to the Fed’s policy of raising rates to combat inflation. Rate increases have caused many multifamily properties to experience cash flow problems.
Learn More About Commercial Mortgage Rates
Can you lock in a commercial mortgage rate?
Some commercial mortgage lenders lock rates at application, some lenders lock rates at commitment, while others lock rates prior to closing. We are currently in the midst of an increasing rate environment. Rates quoted at application may increase dramatically during the loan application progress, if not locked. It is very important to understand your lender’s procedure upfront to avoid potential confusion.
What documents will I need to provide to get an accurate rate quote?
In order for a commercial mortgage lender to issue a firm loan approval, they will want to understand the financial condition of the borrower, as well as the fundamentals of the property. The borrower will be expected to supply his personal financial statement showing total net worth and liquidity. He will also need to provide a schedule of real estate owned demonstrating experience managing similar properties. Lastly, the borrower’s credit scores will needed. For the subject property, lenders will look closely at the current rent roll, operating statements showing income and expenses, copies of all leases, and other pertinent property information.
How do I get the best rate?
Commercial mortgage rates are determined by many different factors, including property type, location of the property, loan-to-value ratio, debt service coverage ratio, debt yield, borrower’s net worth, liquidity, credit rating and level of experience. Commercial mortgage lenders look at all of these factors to determine the riskiness of the loan before setting rates. Loans with the lowest risk profile will get the best rates. As the potential risk increases, rates usually increase.
Are commercial mortgage rates higher than residential?
Commercial mortgage loans are viewed differently by lenders than residential loans. Home loan lenders look strictly at the borrower’s income and credit in order to qualify. Commercial mortgage lenders look at the subject property’s rent roll, operating statements, and other factors to determine the cash flow or net income potential. Very strong (low risk) commercial mortgage loans might be priced lower than home loans, while weaker performing properties (higher risk) might be priced higher.
What are the terms of a commercial loan?
Most commercial mortgage loans today are fixed for 5, 7, or 10 years and come with a 25-30 year amortization schedule. Loans can be recourse (personal guarantee) or non-recourse (no personal guarantee). Commercial mortgage loans typically carry prepayment penalties, whereas residential home loans usually do not. Specific terms will be determined by your lender’s underwriting team after your application is reviewed.
What amount of down payment is required for a commercial property loan?
Commercial mortgage lenders typically lend up to 75-80% on an apartment purchase (down payment of 20-25% necessary). On other types of commercial property, commercial mortgage lenders will typically lend up to 70-75% (down payment of 25-30% necessary). An exception is for owner occupied business real estate (such as a business owner buying his own property). Owner/users may qualify for up to 90% LTV financing.
Commercial Mortgage Benefits
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Commercial mortgage rates start as low as 5.04% (as of September 16th, 2024)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multifamily, 75% on commercial (90% with SBA)
• Terms and amortizations up to 30 years
• Loans for purchase and refinance, including cash-out
• 24 hour written pre-approvals with no cost and no obligation
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Recent Closings
Commercial Loan Refinance Commercial real estate loan refinance of a 224 unit apartment complex known as Compass Pointe I and II, located in Valparaiso IN.
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NNN Credit Tenant Lease Cash out refinance of a single tenant net leased property leased to Walgreens Drug Store in St. Louis. Our company specializes in NNN lease loans.
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Portfolio of Individual Homes Refinance of a portfolio of homes: 30 duplexes, 5 singles, 1 four unit in New Orleans LA. We have a specialized loan product for portfolio loans.
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Self Storage Mortgage Loan Commercial mortgage refinance of three self storage facilities located in Georgia and North Carolina. Borrower refinanced for lower rate.
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Ohio Commercial Real Estate Loan Commercial real estate refinance of 29 multi-family properties located in Troy OH. Loan was a blanket loan covering the entire portfolio.
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New York Commercial Real Estate Loan Commercial mortgage refinance of a medical campus in upstate NY. Property consisted of multiple medical buildings leased to a local hospital.
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Alabama Office Building Loan Acquisition financing to assist a buyer with the purchase of single tenant office building in Alabama, leased to a telecommunications company.
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Georgia Medical Building Loan Commercial mortgage loan to refinance a medical office building located in Loganville Georgia. Borrower refinanced to obtain a lower rate.
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Indiana Apartment Loan Refinance Apartment loan refinance of a 224 unit complex known as Compass Pointe I and II, located in Valparaiso IN.
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Texas Commercial Real Estate Loan Commercial refinance of a 27,125 square foot retail shopping center, containing 6 tenants, located in a suburb of Houston TX.
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Multifamily Loan Rates - Detailed
For the most accurate and up-to-date information on multifamily rates, rental market trends, and investment opportunities, select your state from the dropdown menu below:
Multifamily Rates Updated September 16th, 2024
| Multifamily Loan Rates Over $6,000,000 | Rate* | Amortization | |
|---|---|---|---|
| 5 Year Fixed | 4.98% | Up to 30 years | |
| 7 Year Fixed | 5.01% | Up to 30 years | |
| 10 Year Fixed | 5.04% | Up to 30 years |
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
| Multifamily Loan Rates Under $6,000,000 | Rates* | Amortization | |
|---|---|---|---|
| 5 Year Fixed | 5.45% | Up to 30 years | |
| 7 Year Fixed | 5.42% | Up to 30 years | |
| 10 Year Fixed | 5.39% | Up to 30 years |
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
Commercial Mortgage Rates - Detailed
For the most accurate and up-to-date information on rates, rental market trends, and investment opportunities, select your state from the dropdown menu below:
Commercial Mortgage Rates Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 3 Year Fixed | 6.24% | Up to 25 years |
| 5 Year Fixed | 6.16% | Up to 25 years |
| 7 Year Fixed | 6.22% | Up to 25 years |
| 10 Year Fixed | 6.32% | Up to 25 years |
CMBS Rates - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 10 Year Fixed | 5.95%-6.52% | Up to 30 years |
NNN Lease - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 3 Year Fixed | 6.04% | Up to 30 years |
| 5 Year Fixed | 5.96% | Up to 30 years |
| 7 Year Fixed | 6.02% | Up to 30 years |
| 10 Year Fixed | 6.12% | Up to 30 years |
Fannie Mae Small Balance Apartment - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 5 Year Fixed | 5.53%-6.50% | Up to 30 years |
| 7 Year Fixed | 5.30%-6.45% | Up to 30 years |
| 10 Year Fixed | 5.19%-6.39% | Up to 30 years |
| 15 Year Fixed | 5.54%-6.67% | 30 years |
| 30 Year Fixed | 5.47%-6.59% | 30 years |
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
Fannie Mae Large Balance Apartment - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 5 Year Fixed | 4.98%-6.02% | Up to 30 years |
| 7 Year Fixed | 5.00%-6.04% | Up to 30 years |
| 10 Year Fixed | 5.03%-6.07% | Up to 30 years |
| 15 Year Fixed | 5.18%-6.26% | 30 years |
| 30 Year Fixed | 5.09%-6.15% | 30 years |
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
Freddie Mac Small Balance Apartment - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 5 Year Fixed | 5.47% | Up to 30 years |
| 7 Year Fixed | 5.35% | Up to 30 years |
| 10 Year Fixed | 5.34% | Up to 30 years |
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
Bank Apartment Mortgage - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 5 Year Fixed | 5.75%-6.50% | Up to 30 years |
| 7 Year Fixed | 6.00%-6.75% | Up to 30 years |
| 10 Year Fixed | 6.25%-7.00% | Up to 30 years |
- Tiered pricing from 55% – 80% LTV
- Simplified underwriting for small balance loans
- Loan amounts from $1,500,000 - $10,000,000+ Nationwide
- Loan to value ratios up to 80% on purchases and 75% on refinances
- Cash out refinances are acceptable
- Pricing based on loan-to-value and debt service coverage ratio:
- Tier 2 - 75-80%/1.25x
- Tier 3 - 65%/1.35x
- Tier 4 – 55%/1.55x
- Interest only loans are available
- Step down and yield maintenance prepayment penalties
- Nonrecourse loans are available
CMBS Multifamily - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 10 Year Fixed | 5.95%-6.52% | Up to 30 years |
- Up to 75% LTV
- Loan amounts from $2 million and up
- Loans available for apartment buildings, retail shopping centers, office buildings, warehouses and hospitality
- Loan to value ratios up to 75% on purchases and refinances
- Cash out refinances are acceptable
- Interest only loans are available
- Loans are non-recourse
Multifamily Bridge
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Owner Occupied Commercial Mortgage Rates - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| 3 Year Fixed | 6.14% | Up to 30 years |
| 5 Year Fixed | 6.06% | Up to 30 years |
| 7 Year Fixed | 6.12% | Up to 30 years |
| 10 Year Fixed | 6.22% | Up to 30 years |
Small Business Administration (SBA) - Detailed
Updated September 16th, 2024
| Loan Product | Rate* | Amortization |
|---|---|---|
| Adjustable | 7.50%-10.00% | Up to 25 years |
| 5 Year Fixed | 7.50%-10.00% | Up to 25 years |
