Commercial Loans in South Florida for Business Owners and Investors
Financing commercial real estate is very different from financing a traditional home. Property type, cash flow, business financials, down payment, occupancy, borrower experience and the purpose of the loan can all affect which lender and loan structure makes the most sense.
Mortgages Done Right helps business owners, real estate investors and commercial property buyers compare commercial loan options in Florida through multiple lending sources rather than relying on the guidelines of a single bank.
Whether you are purchasing a commercial property, refinancing an existing building, acquiring an investment property or looking for financing for a new business location, the goal is to match the property and transaction with a lender that is comfortable with the scenario.
What Types of Commercial Properties Can Be Financed?
Commercial financing can be available for many different property types. Loan terms and qualification requirements vary by lender and transaction, but examples may include:
- Office buildings and professional offices
- Retail properties and shopping centers
- Warehouses and industrial properties
- Mixed-use properties
- Multifamily properties
- Medical and dental offices
- Owner-occupied business properties
- Investment commercial real estate
- Restaurants and certain hospitality properties
- Self-storage and specialty-use properties
Because commercial properties can be very different from one another, there is rarely a single loan program that fits every transaction. This is one reason working with a mortgage broker that can compare different lending sources can be valuable.
Owner-Occupied vs. Investment Commercial Property
One of the first questions a commercial lender will consider is how the property will be used.
Owner-Occupied Commercial Property
An owner-occupied commercial property is generally used by the borrower’s own business. Examples could include a medical practice purchasing its office, a contractor buying a warehouse, or a business owner purchasing a retail or professional building instead of continuing to rent.
For established businesses, owning the property can provide greater control over occupancy costs while creating a long-term real estate asset.
Commercial Investment Property
Commercial investment properties are purchased primarily to generate rental income or investment returns. In these transactions, lenders may pay particular attention to the property’s income, leases, expenses, occupancy and overall ability to support the proposed debt.
Investors purchasing residential rental properties may also want to compare commercial financing with DSCR investor loan options, depending on the property type and transaction.
Commercial Purchase Loans
Commercial purchase financing can help business owners and investors acquire real estate without paying the entire purchase price in cash.
The required equity contribution can vary substantially depending on the property, borrower, lender and overall strength of the transaction. Commercial financing is generally evaluated individually rather than using a single set of guidelines that applies to every borrower.
Before making an offer, it can be helpful to review the proposed transaction with a commercial mortgage professional so you have a better understanding of possible financing structures and lender expectations.
Commercial Refinance Loans
Commercial property owners may refinance for several reasons, including replacing an existing loan, restructuring debt, improving cash flow, accessing equity or adjusting the financing as the property or business changes.
A refinance can also provide an opportunity to compare the current lender against other commercial lending sources instead of automatically accepting an existing lender’s renewal or refinance proposal.
What Do Commercial Lenders Look At?
Commercial underwriting can vary considerably by lender, but several factors commonly influence the approval and loan structure.
- Property type: Lenders may have different appetites for office, retail, industrial, multifamily and specialty properties.
- Property value: The appraisal and proposed loan-to-value ratio are important components of most commercial transactions.
- Property income: For investment real estate, lenders may evaluate rents, leases, expenses and net operating income.
- Business financial strength: Owner-occupied transactions may involve a review of business revenue, profitability and financial statements.
- Borrower credit and liquidity: Credit profile, available reserves and overall financial strength can affect lender options.
- Experience: Some lenders consider the borrower’s experience owning, operating or managing similar properties or businesses.
- Down payment or equity: Commercial transactions often require meaningful borrower equity, although requirements vary widely.
Documents You May Need for a Commercial Loan
Commercial loans frequently require more documentation than a standard residential mortgage. The exact requirements depend on the lender and property, but borrowers may be asked for items such as:
- Personal financial statements
- Business financial statements
- Business and personal tax returns when applicable
- Bank or asset statements
- Current leases and rent rolls
- Property operating statements
- Purchase contract
- Existing mortgage information for refinances
- Business formation documents
- Information about the property and intended use
Not every commercial lender requires the same documentation. Part of our job is identifying lending options that fit the borrower and property rather than forcing every transaction into the same underwriting box.
Why Use a Mortgage Broker for a Commercial Loan?
Going directly to one bank gives you access to that institution’s commercial lending guidelines. If your transaction does not fit those guidelines, the answer may simply be no.
A commercial mortgage broker can evaluate the transaction across multiple lending sources. That can be especially valuable when the property, income documentation, borrower profile or loan purpose does not fit a traditional bank’s standard program.
Mortgages Done Right has more than 30 years of mortgage experience and access to more than 25 lending sources. We use that network to help identify financing structures that make sense for the property and borrower instead of relying on only one lender.
Commercial Loans in Palm Beach County
Palm Beach County has a diverse commercial real estate market that includes professional offices, medical properties, retail, warehouses, multifamily properties and owner-occupied business locations.
As a Boynton Beach-based mortgage company, Mortgages Done Right works with borrowers throughout Palm Beach County who are purchasing or refinancing commercial real estate.
Local borrowers benefit from working with someone who understands both the South Florida market and the different financing approaches available for commercial transactions.
Commercial Loans in Broward County and Fort Lauderdale
We also help commercial borrowers throughout Broward County, including business owners and investors seeking financing in and around Fort Lauderdale.
South Florida commercial transactions can range from straightforward owner-occupied purchases to complex investment properties. Having access to multiple lending sources gives us more flexibility when evaluating those different scenarios.
Commercial Loan Frequently Asked Questions
How much down payment is required for a commercial property?
There is no single down-payment requirement for every commercial loan. Required equity depends on the lender, property type, borrower strength, cash flow, occupancy and overall transaction. Some scenarios require considerably more equity than others.
Can I finance a commercial property for my own business?
Yes. Owner-occupied commercial financing can be used by qualifying businesses purchasing property for their own operations. The lender will typically evaluate both the property and the financial strength of the business and borrower.
Can commercial investment properties be refinanced?
Yes. Commercial property owners may refinance existing debt, restructure financing or potentially access equity depending on the property, lender guidelines and borrower qualifications.
Are commercial loan rates the same as residential mortgage rates?
No. Commercial loans are priced differently from residential mortgages. Rates and terms can vary based on the property, loan structure, lender, borrower strength, leverage and market conditions.
Do commercial lenders require tax returns?
Some do, while some commercial programs may offer alternative documentation approaches depending on the transaction. Documentation requirements vary significantly among lenders, which is another reason it can help to compare multiple options.
Can a mortgage broker help if my bank declined my commercial loan?
Potentially. A decline from one bank does not necessarily mean every commercial lender will view the transaction the same way. Different lenders have different property preferences, underwriting standards and risk tolerances.
Compare Commercial Loan Options in South Florida
Commercial financing should start with understanding the transaction rather than trying to force every borrower into the same loan program.
Greg Hayden and Mortgages Done Right help South Florida business owners and investors compare commercial financing options for purchases, refinances and investment properties. With more than 30 years of mortgage experience and access to more than 25 lending sources, our goal is to identify a financing strategy that fits the property and your objectives.
For more information, review our Florida commercial loan programs or contact Mortgages Done Right to discuss your transaction.
Ready to discuss a commercial property?
Call Greg Hayden at 561-777-7622 or apply online.
Commercial loan programs, rates, terms, documentation requirements and availability vary by lender, borrower and property. This information is for general educational purposes and is not a commitment to lend.
