Interest Rates

We received a lot of questions about interest rates, if they are different for commercial properties vs residential, and how they affect the monthly payments.

Interest rates for commercial mortgages affect the total cost of the loan and the amount that needs to be repaid. Interest rates are usually expressed as an annual percentage rate (APR) and include any additional fees or charges. 

Here are some factors that affect commercial mortgage interest rates: 

• Prime interest rate: The prime interest rate is a benchmark for many commercial real estate loans. When the prime rate increases, so does the interest rate on the loan. 

• Loan term: Longer loan terms usually result in better rates because the total interest payment over time is larger for the lender. 

• Amortization period: The time it takes to repay the loan can also impact the interest rate. A longer amortization period may result in a higher overall interest cost. 

• Creditworthiness: The borrower's creditworthiness is a factor that lenders consider. 

• Market conditions: Market conditions are a factor that lenders consider.