How to Qualify for a Commercial Loan in 2025

Chaz Bicknell has been an active Mortgage Professional for over 27 years. Chaz has worked with hundreds of loan scenarios, including JUMBO loans, FHA, VA, USDA, foreign nationals, reverse mortgages and commercial. Chaz would love to assist you with your next refinance, purchase, reverse purchase, reverse mortgage or commercial. With so many changes in the mortgage industry, make sure you speak with Chaz before you decide to work with any lenders or mortgage brokers. Chaz taught mortgages for 11 years and owned the largest mortgage education publishing company in the state of Florida for many years. Chaz was also a Certified Public Accountant for over 17 years. Put him to work for you today!!

For mortgage information call or to start a mortgage application at www.MortgagesbyChaz.com

For all your Mortgage needs please contact Chaz Bicknell at ChazBicknell@yahoo.com at 239 272-4442

Thinking of investing in commercial real estate...
or buying a property for your business in 2025?

Before you get too far into the process,
you need to know how to qualify for a commercial loan.

In this video,
I'll break it all down—
from credit requirements and DSCR loans,
to down payments and the types of properties lenders look for.

Let’s start with credit.

In 2025,
most lenders are looking for a credit score of at least 660 to 680.

But if you want better interest rates and more flexible terms,
you’ll want to aim for 700 or higher.

And keep in mind—
both your personal and business credit may be reviewed,
especially if you're a small business owner or offering a personal guarantee.

Make sure your credit report is clean,
up to date,
and free of any errors before applying.

[Section 2: DSCR Loans]
Next up—DSCR.
That stands for Debt Service Coverage Ratio.

This is how lenders measure whether a property earns enough income
to cover its loan payments.

Here’s the formula:
DSCR equals Net Operating Income divided by Annual Debt Payments.

Most lenders want to see a DSCR of at least 1.25.

That means your property should be bringing in 25% more income than the loan costs.

So for example,
if your debt payments are 100 thousand dollars per year,
you’ll need at least 125 thousand in annual net operating income.

If your DSCR is too low,
your loan may be denied—
or you might need to bring more money to the table.

[Section 3: Down Payments]
Let’s talk about down payments.

Commercial loans require a larger investment up front
than your typical home mortgage.

In most cases,
you’ll need to put down 20 to 30 percent of the property’s purchase price.

There are exceptions—
some lenders might allow 15% down,
but only if the deal is rock solid.

That means high DSCR, stable tenants,
and a low-risk property type.

So be ready to show that you’ve got skin in the game.

Now, not all commercial properties are treated equally.

Here are some of the most common types lenders are willing to finance:

Office buildings

Retail spaces

Industrial properties

Multifamily with 5 units or more

And mixed-use buildings

Lenders prefer stabilized properties—
those that are leased, producing income,
and in good physical condition.

If the building is vacant, under renovation,
or highly specialized—like a gas station or a church—
you may face stricter terms or need alternative financing.

Let’s recap what you’ll need to qualify for a commercial loan in 2025:

✅ A credit score of 660 or better, ideally 700+
✅ A DSCR of at least 1.25
✅ A down payment of 20 to 30 percent
✅ And a property that is stabilized and income-producing

And here's one final tip:
Work with a commercial mortgage broker.
They can help match you with the right lender
and structure the deal in a way that works for both sides.

About me and the lenders I work with.

Drop your questions in the comments—I respond to all of them!

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