Key Takeaway
- Commercial real estate loan rates in early 2026 range from 3.5% to 6%.
- Some specialized, long-term, government-backed loans reach as low as 3.5% to 4.5%, while many conventional and portfolio loans range higher between 4.5% and 6.0% or above.
- Bridge loans typically start around 5.99%.
- Hard money loans start closer to 7.59%, depending on the deal structure and risk profile.
Unlike residential mortgages, CRE loan rates aren’t standardized and are instead based on a benchmark index like SOFR.
Then, lenders add a margin based on measurable risk factors such as the borrower’s credit strength and the type/location of the property.
External factors like inflation or economic uncertainty can make lenders more cautious, which pushes rates higher even for strong borrowers.
Commercial Real Estate Loan Rates in January 2026
1. Bridge loan rates for commercial properties
Here at Private Capital Investors, our rates for commercial real estate bridge loans start at 5.99%.
We provide loans up to $50 million, with terms ranging from 1 to 3 years.
Depending on the in-place DSCR at exit, we can finance up to 85% LTV.
Our bridge loans are secured by a first mortgage lien, giving you access to competitive terms backed by clear collateral.
We include monthly escrows for property taxes and insurance to keep the asset protected, and require replacement reserves to ensure that funds are available for future upgrades or repairs.
2. Hard money loan rates for commercial properties
Our hard money loan rates for commercial properties start at 7.59% here at Private Capital Investors.
We fund loans between $1 million and $50 million.
Terms range from 3 to 24 months. If you’re acquiring a property with limited lead time or need short-term capital for repositioning, we can close in as little as two weeks.
Our hard money loans are typically interest-only, so you’ll make monthly interest payments throughout the term and repay the principal at the end.
3. Stated income loan rates for commercial properties
At Private Capital Investors, our stated income commercial real estate loans are designed to simplify the process.
You won’t need to provide tax returns, W-2s, or bank statements.
If your credit score is 650 or higher, you may qualify for a loan between $1 million and $50 million.
Since these are low-documentation loans and close faster, we price each deal based on the risk profile and structure.
How do Commercial Real Estate Loan Rates Work?
Most CRE loan lenders base their rates on a benchmark like the prime rate or Treasury yields.
For example, a loan might be priced at “Prime + 1.5,” which means that the loan’s interest rate is 1.5 percentage points higher than the current prime rate.
That prime rate, in turn, is closely tied to the Federal Funds Target Rate, which the Federal Reserve changes to manage inflation and job growth.
When the Fed raises or lowers rates, the cost of borrowing usually moves with it.
If you’re using an SBA 504 loan, your interest rate isn’t set up front.
It’s tied to U.S. Treasury yields and gets locked in only when the loan is funded, which can be several months after approval.
At that point, the loan is bundled with others and sold to private investors through a monthly debenture sale.
Since those investors are paid semiannually and borrowers make monthly payments, the effective borrower rate ends up slightly lower than the Treasury rate plus the agreed spread.
A small portion of your rate also covers administrative fees for the SBA and the CDC.
How do lenders set interest rates for your specific deal?
Once the broader market conditions are factored in, lenders will then evaluate your individual risk.
Different types of lenders do this differently.
1. Traditional Banks
Traditional banks will normally assess your personal credit score in addition to the characteristics of the property.
If you and the property’s finances are solid — if you have good credit and the property generates a high and stable income, for example — you’re more likely to get a better rate.
Banks will see the deal as a lower risk, so they don’t need to charge as much to protect themselves.
But if the property has spotty cash flow or if your financials raise red flags, that rate will go up.
Most banks will also check your debt service coverage ratio (DSCR), which shows how comfortably your net income covers your loan payments.
2. Non-bank lenders/private lenders
Non-bank lenders/private lenders, in contrast, tend to focus more on the property itself than on your financial background as a borrower.
If you’re working with a private capital firm or an independent lender, what you really need to show is the asset’s earning potential or location, not your credit score. These loans are usually shorter in terms and carry higher rates.
Here at Private Capital Investors, we provide alternative financing options tailored to time-sensitive deals or borrowers who are working on value-add projects and fast acquisitions.
The interest rates on our bridge, hard money, and stated income loans for commercial real estate are based on the asset, not your financials.
Rates are higher but approval timelines are also shorter. Find out more here.
3. SBA 504 Loans
SBA 504 loans work differently. Everyone who closes their SBA 504 loan in the same month gets the same rate.
These loans follow a three-part structure. First, a conventional lender covers 50% of the total loan as your first mortgage.
Then a CDC steps in to coordinate a second loan backed by the SBA, covering 40% of the cost. This second portion comes with a fixed interest rate and a 10- or 20-year term.
The remaining 10% comes from you as the borrower. If you’re buying a property the SBA classifies as single-purpose (like a gas station or hotel), you’ll need to contribute 15% instead.
Do loan structures affect your interest rate and repayment schedule?
Yes. The type of interest rate you choose will affect how predictable your payments are over time.
Variable rates often start lower, but they can reset every few years depending on market conditions.
If rates rise, so will your monthly payments. Most conventional commercial loans use variable structures.
SBA 504 loans, on the other hand, lock in your rate for the full term.
You also need to watch out for balloon payments.
Many commercial real estate loans come with a shorter term than their amortization schedule.
If you have a 20-year amortization but only a 7-year term, you’ll need to pay off the rest at the end of year 7, either by refinancing or by making a large lump-sum payment.
If you want to avoid this, look for fully amortized loans where the term and amortization are aligned. SBA 504 loans are fully amortized by design.
Want to know your rate?
Get in touch with us directly, and we will run the numbers with you. Call Private Capital Investors at (972)-865-6206.
