Commercial Real Estate Loan Requirements by Loan Type

Not at all. Bank requirements are among the strictest. DSCR loans, bridge lenders, and private capital have completely different qualification criteria focused on the property rather than the borrower. A decline from one lender type says nothing about your eligibility with others.

Not since March 1, 2026. SBA now requires 100% of a business’s direct and indirect owners to be U.S. citizens or U.S. nationals whose principal residence is in the U.S.; lawful permanent residents (green card holders) can no longer hold any ownership in an SBA 7(a) or 504 borrower (SBA Policy Notice 5000-876441). Conventional bank, DSCR and other non-SBA loans are still available to those owners.

A new business buying a building it will occupy can use SBA 504 with 15% down instead of 10% (20% for a special-purpose building), and SBA 7(a) has no minimum time in business, though a startup must put in at least 10% equity. A first-time investor buying rental property usually has more options with a DSCR lender or a bank that knows them, typically with more down, stronger credit or professional management in place.

Character (credit history, experience, honesty in the application), capacity (cash flow to repay — DSCR for a property, global cash flow for a business), capital (your equity and reserves), collateral (the property’s value and condition) and conditions (the loan purpose, the market and the property type). Commercial lenders weigh all five; a weakness in one can be offset by strength in others.

It depends on the loan type. SBA and bank loans typically require 680+. CMBS lenders focus primarily on the property and may accept 660+. DSCR loans start at 660+. Bridge lenders often want 640+; hard money lenders may accept 620+ with strong collateral. Our advisors match you to the right program for your credit profile.

Yes. DSCR loans are specifically designed for this. They qualify based entirely on the property’s rental income vs. debt service — no personal tax returns, W-2s, or income verification required. Useful for self-employed investors and business owners with complex tax returns.

Typical requirement is 6–12 months of debt service payments in liquid assets (cash, money market, stocks) after closing. CMBS lenders may require additional reserves for tenant improvements and capital expenditures. SBA programs are more flexible on reserves.

For bank and CMBS loans, experience is preferred but not always required for stabilized acquisitions. Bridge and value-add lenders typically want 2–3 completed projects. SBA programs focus more on business operations than real estate experience. First-time investors should consider partnering with experienced sponsors.

Four things: increase your down payment (more equity = better terms), improve property DSCR (negotiate higher rents or lower purchase price), build post-closing reserves (6–12 months), and prepare a complete document package before applying. Our calculators can help you model the numbers.