Missouri Commercial Real Estate Loans: No Transfer Tax & PACE
What changes for a commercial property loan in Missouri: no transfer tax, deed-of-trust foreclosure by notice, a narrow redemption right, deficiency rules and PACE.
| What | Missouri |
|---|---|
| Real estate transfer tax | None. The constitution bars the state, counties and other political subdivisions from imposing any new tax, including a sales tax, on the sale or transfer of homes or any other real estate (adopted by voters in 2010 as Amendment 3). [1] |
| Foreclosure process and notice | Non-judicial: a trustee sells under the deed of trust’s power of sale. The notice is published at least twenty times, continuing to the day of sale, in a daily newspaper in counties with a city of 50,000 or more; elsewhere for four successive issues of a weekly paper, the last not more than one week before the sale. It is also mailed by certified or registered mail at least 20 days before the sale. [2] |
| Redemption after the sale | Only when the holder of the debt buys the property at the sale: the borrower may then redeem within one year by giving written notice of intent at the sale or within ten days before it, and giving security within twenty days after the sale. If anyone else is the buyer, there is no statutory redemption. [3] |
| Deficiency after the sale | A deficiency is measured by the price received at the foreclosure sale, not the property’s fair market value. A sale price so inadequate that it raises an inference of fraud is grounds to set the sale aside, not to reduce the deficiency. [4] |
| C-PACE law and program | Under the Property Assessed Clean Energy Act, municipalities form clean energy development boards that finance energy efficiency and renewable energy improvements under an assessment contract. Each annual special assessment is a lien on the property from the date it comes due. The Missouri Clean Energy District, formed in 2011 under the Act, offers a C-PACE program in member communities. [5] |
Checked 2026-10-15; sources are listed at the end of the page. Rates and rules change — your title company and closing attorney confirm the figures for a specific deal.
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Commercial property loans in Missouri use the same programs as every other state — SBA 504, DSCR loans, bridge loans, bank and life-company permanent loans. What Missouri changes is short on the cost side and long on the default side: the constitution bars a transfer tax, a deed of trust is foreclosed by a trustee's sale rather than a lawsuit, redemption after the sale exists only in one narrow case, a deficiency is measured by the sale price, and PACE runs through clean energy development boards.
No transfer tax, by constitution
Missouri voters added Article X, Section 25 to the constitution in 2010. It bars the state, counties and other political subdivisions from imposing any new tax — a sales tax included — on the sale or transfer of homes or any other real estate. No transfer tax was in place when it passed, so a commercial deed in Missouri carries none.
Example: a $2,000,000 commercial building bought with a $1,400,000 loan.
- Transfer tax on the $2,000,000 deed: $0
- Recording the deed and the $1,400,000 deed of trust: the county recorder's recording fees, not a percentage of the price or the loan
Next door in Illinois, the same sale carries $3,000 in state and county transfer tax outside a city with its own tax (where the county levies its $0.25 per $500) and $24,000 in Chicago. In Missouri the closing costs on a purchase or a refinance are mostly lender, title and appraisal fees.
Foreclosure by trustee's sale
Missouri commercial loans are secured by a deed of trust with a power of sale, so a default can lead to a trustee's sale without a court case. The statute sets the notice, not a long waiting period: in a county with a city of 50,000 or more, the notice runs in a daily newspaper at least twenty times, continuing to the day of the sale; elsewhere it runs in four successive issues of a weekly paper, the last no more than a week before the sale. The trustee also mails notice by certified or registered mail at least 20 days before the sale.
That timeline is short. Compare Wisconsin, where a commercial foreclosure goes through court and the sale cannot be held until six months after judgment (three if the mortgage allows it and the lender waives any deficiency). If a sale or refinance is your way out of a troubled loan, start it at the first missed payment, not at the first notice — and use DSCR to see how far income has fallen short.
A narrow redemption right and the deficiency
Missouri's statutory redemption applies only when the holder of the debt — usually the lender — buys the property at the sale. Then the borrower may redeem within one year, but only by giving written notice of intent at the sale or within ten days before it, and giving security within twenty days after the sale. If a third party is the high bidder, there is no statutory redemption.
If the sale brings less than what is owed, the Missouri Supreme Court held in 2012 that the deficiency is measured by the price received at the sale, not the property's fair market value. A price so low that it suggests fraud is grounds to set the sale aside, not to shrink the deficiency. That matters for anyone who signed a personal guarantee; on a non-recourse loan, read the carve-outs that would turn recourse back on.
PACE: clean energy development boards
Missouri's Property Assessed Clean Energy Act lets municipalities form clean energy development boards that finance energy efficiency and renewable energy improvements through an assessment contract with the owner. Each annual special assessment becomes a lien on the property from the date it comes due. The Missouri Clean Energy District, a political subdivision formed in 2011 under the Act, offers a C-PACE program in the counties and cities that have joined it — check first that your community is a member.
Because the assessment sits on the property alongside your mortgage, talk to your mortgage lender before you sign an assessment contract. C-PACE Desk, a BestLoanUSA site, tracks Missouri's C-PACE status.
Where to start
Choose the program — SBA 504 for an owner-occupied building, a DSCR loan or permanent loan for an income property, a bridge loan for a transition — and read the deed of trust's default and notice terms before you sign. Size the loan with the commercial mortgage calculator. For financing that isn't tied to real estate, the Missouri business loan guide covers SBA offices and state programs.
Ready to compare? Start a commercial real estate loan request — one application, compared across our lender network.
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Sources: Mo. Const. art. X, § 25; RSMo § 443.320; RSMo § 443.325; RSMo §§ 443.410 and 443.420; First Bank v. Fischer & Frichtel, Inc., 364 S.W.3d 216 (Mo. 2012); RSMo §§ 67.2800–67.2835 (§ 67.2815); Missouri Clean Energy District. Checked 2026-10-15.
The bottom line
Missouri adds no transfer tax to a commercial purchase — the constitution bars a new one — so a $2,000,000 building closes without that line on the settlement statement. The state’s weight falls on the other side of the loan: a deed of trust can be foreclosed by a trustee’s sale after newspaper and mailed notice, without a lawsuit, and any deficiency is measured by the sale price. If you sign a personal guarantee, read the default and notice terms as closely as the rate.
Commercial loan rates and terms in Missouri
Rates and leverage come from the lender, the property and the borrower, so they are the same national ranges in Missouri as elsewhere — what changes here are the closing costs and rules in the table above. Typical terms as of September 2026:
| Program | Rate | Max LTV / LTC | Term |
|---|---|---|---|
| Bank / credit union | 6.5–8% | 65–75% (80% multifamily) | 5–10 yr |
| SBA 504 | 6.25–7.25% | Up to 90% | 10–25 yr |
| SBA 7(a) | 8.5–11.5% | Up to 90% | Up to 25 yr |
| DSCR | 6.75–8.75% | Up to 75–80% | 5–30 yr |
| CMBS | 7–8% | Up to 75% | 5–10 yr |
| Bridge | 6.25–8.25% | 65–80% | 12–36 mo |
| Construction | 6.75–10.5% | 65–80% LTC | 12–24 mo |
How each range is built: commercial real estate loan rates by type.
Missouri commercial real estate loan FAQ
What are commercial mortgage rates in Missouri?
Commercial lenders price a loan on the property and the borrower rather than the state, so Missouri rates follow national ranges: about 6.5–8% for a bank loan, 6.25–7.25% for SBA 504, 6.75–8.75% for a DSCR loan and 6.25–8.25% for a bank or debt-fund bridge loan (benchmarks as of September 2026).
How much down payment do I need for a commercial property in Missouri?
Typically 25–35% for a bank loan and 20–25% for a DSCR loan. An owner-occupied building can qualify for SBA 504 with 10% down (15% for a business under two years old or a special-purpose building, 20% if both).
Does Missouri charge a transfer tax on a commercial property sale?
No. The state constitution bars the state and local governments from imposing any new tax on the sale or transfer of real estate, so a $2,000,000 sale carries no transfer tax. The deed and deed of trust are still subject to the county recorder’s recording fees.
Does a Missouri commercial foreclosure go through court?
Usually not. Commercial loans are secured by a deed of trust with a power of sale, and the trustee sells the property after newspaper notice and a certified or registered letter mailed at least 20 days before the sale.
Can a Missouri borrower buy the property back after a foreclosure sale?
Only in one case: if the lender holding the debt is the buyer, the borrower can redeem within one year — but only by giving written notice of intent at the sale or within ten days before it, and giving security within twenty days after.
Sources
- Mo. Const. art. X, § 25
- RSMo §§ 443.320 and 443.325
- RSMo §§ 443.410 and 443.420
- First Bank v. Fischer & Frichtel, Inc., 364 S.W.3d 216 (Mo. 2012)
- RSMo §§ 67.2800–67.2835 (§ 67.2815); Missouri Clean Energy District
Checked 2026-10-15.
Run the numbers
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- SBA 504 Loan Calculator Estimate your SBA 504 loan structure — see the three-part split (borrower, CDC, bank), monthly payments for each portion, and total project financing.
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