Fixed-Rate Commercial Mortgages
 

A fixed-rate commercial mortgage provides a consistent interest rate and monthly payment for the duration of the loan term. This option offers stability and protection against future interest rate increases, making budgeting easier.

Best for:

• Long-term property owners

• Investors seeking predictable payments

• Businesses that value financial stability
   

Variable-Rate Commercial Mortgages
 

Variable-rate mortgages fluctuate based on changes to the lender's prime rate or another benchmark interest rate. They often start with lower rates than fixed mortgages but may increase or decrease over time.

Best for:

• Borrowers comfortable with market fluctuations

• Investors expecting interest rates to decline

• Those seeking lower initial borrowing costs
   

Floating-Rate Commercial Mortgages
 

Floating-rate loans are typically tied to a benchmark rate, such as SOFR, plus a lender margin. These loans are commonly used for short-term financing and investment opportunities.

Best for:

• Short-term financing

• Commercial investors

• Bridge financing strategies
   

Bridge Financing
 

Bridge loans provide temporary financing until long-term financing or the sale of another property is completed. Because they are short-term and carry higher risk, they generally have higher interest rates than conventional commercial mortgages.

Best for:

• Time-sensitive purchases

• Property acquisitions

• Interim financing between transactions
   

Construction Financing
 

Construction loans are designed to finance new developments, major renovations, or commercial building projects. Funds are advanced in stages as construction progresses, with rates reflecting the increased risk during development.

Best for:

• New commercial construction

• Multi-unit residential developments

• Major renovation projects
   

Conventional Commercial Mortgages
 

Conventional commercial mortgages are the most common financing solution for income-producing properties such as office buildings, retail plazas, industrial facilities, and apartment buildings. Rates are based on the property's financial performance and the borrower's qualifications.

Common Property Types:

• Office buildings

• Retail centres

• Industrial properties

• Multi-family residential

• Mixed-use buildings
   

Private Commercial Mortgages
 

Private commercial mortgages provide financing for borrowers who may not qualify through traditional lenders. While they offer greater flexibility and faster approvals, interest rates are generally higher due to increased lending risk.

Best for:

• Alternative financing needs

• Time-sensitive transactions

• Unique or specialized properties

• Credit challenges
   

What Affects Commercial Mortgage Rates?
 

Several factors determine the interest rate you'll receive, including:

• Loan-to-Value Ratio (LTV)

• Debt Service Coverage Ratio (DSCR)

• Property type and location

• Borrower experience and financial strength

• Property cash flow and occupancy

• Loan amount

• Mortgage term and amortization period

• Current market interest rates

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