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Commercial Real Estate Loans: Compare Best Options

Online lenders offer real estate loans for purchases, renovations or refinancing debt. Compare your options.
Steve NicastroNovember 21, 2019
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
Purchasing real estate, renovating your current property or refinancing real estate debt can be a smart way to grow your small business. Online lenders offer solid alternatives to traditional banks for commercial real estate loans due to looser requirements and faster time to funding. You may, however, pay a bit more for that speed and convenience.
Before shopping for small-business loans, it’s a good idea to estimate the profit from your real estate purchase or renovation or the savings from a refinance to ensure it’s more than the cost of the loan. Always weigh the terms, interest, fees and speed of funding carefully before making a decision.

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Our pick for

Purchases or refinancing

SBA 7(a) loan

Est. APR

5.50 - 8.00%

Min. Credit Score

650

7(a) program participants include specialized lenders like Live Oak Bank and big-name traditional banks like Wells Fargo.

Pros

  • Available as a term loan or line of credit.
  • Interest rates are capped.
  • Long repayment terms available.

Cons

  • Personal guarantee is required.
  • Collateral is typically required.
  • Longer processing times than online lenders.
Read full review

Qualifications:

  • Be a for-profit U.S. business.
  • Must first use alternative financial resources, including personal assets.
  • Financial qualifications determined by individual lender.

Our pick for

Business renovations

Funding Circle - Online term loan

Est. APR

12.18 - 36.00%

Depending on your creditworthiness and your business's financials

Min. Credit Score

660

Funding Circle is an option for established businesses that are financing an expansion or refinancing debt.

Pros

  • Cash can be available within 3 business days.
  • Competitive rates among online lenders.
  • No minimum revenue requirement.

Cons

  • Requires business lien and personal guarantee.
  • Not available in Nevada.
Read full review

Qualifications:

  • Minimum credit score: 660.
  • Minimum time in business: 2 years.
  • Minimum annual revenue: None.
  • No bankruptices in the past 7 years.

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Summary of Commercial Real Estate Loans: Compare Best Options

LenderBest ForEst. APRMin. Credit ScoreNext Steps

SBA 7(a) loan

Best for Purchases or refinancing5.50 - 8.00%650
See Your Loan Options

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Funding Circle - Online term loan

Best for Business renovations12.18 - 36.00%660
See Your Loan Options

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Real estate loans for purchases or refinancing

A Small Business Administration loan is your best bet if you’re an established and profitable business looking for the lowest borrowing costs.
You can get an SBA 7(a) commercial real estate loan up to $5 million. You can use the proceeds to purchase real estate or refinance existing real estate debt.
With a 25-year repayment term and relatively low APRs, you’ll have a lower monthly payment than with regular business loans.
Generally speaking, to qualify for an SBA loan, you'll need a good personal credit score, at least two years in business and strong annual revenue. You also need to meet the SBA’s eligibility requirements. Additionally, to qualify for an SBA commercial real estate loan, a minimum 51% of the property you purchase must be occupied by and used by your business.
Based on its appraised value, you must have at least 10% to 20% equity in the real estate for a refinance or put down 10% to 20% for a real estate purchase.

Real estate loans for renovations

Funding Circle provides loans up to $500,000, with repayment terms up to five years. You need at least two years of business history to qualify, as well as a minimum 660 credit score. There are no minimum revenue requirements, although typical borrowers have annual revenue of about $2 million.

Compare small-business loans

If you’re looking for other financing, NerdWallet has a comparison tool featuring the best small-business loans to meet your needs and goals. We gauged lender trustworthiness, market scope and user experience, along with other factors, and arranged them by categories that include your revenue and how long you’ve been in business.
Last updated on November 21, 2019

To recap our selections...

Commercial Real Estate Loans: Compare Best Options

Does your business need funding? Find your best loan options with Fundera by NerdWallet.

See Your Loan Options