Commercial Mortgage Refinance Rates | What Are the Current Refinance Rates?
The most important number in any commercial mortgage is the interest rate. That is because interest rates determine how much of your monthly payments are paying off the principal and going back into the property, and how much is going to the lenders – never to be seen again.
By the time you get your property there isn’t necessarily much you can do to get a lower rate, other than shop around with different lenders. Interest rates are set by economic factors and most hover around the same basic percentages. But there are times when interest rates may lower nationwide, and that may mean that you can take advantage of commercial mortgage refinance rates.
Rates for Refinancing
Keep in mind that most lenders will not refinance your loan unless you’ve lowered your LTV (often to below 75%) and you’re still able to provide profitability. All of the traditional factors that go into your interest rate still apply, including debts, credit score, length of loan, and more. Commercial mortgage refinance rates are not a static number. They are based largely on the same factors that went into providing you with your initial rate.
That said, the following represent a range of refinance rates that you may encounter:
- 5 Year Loans – 3% to 4%
- 10 Year Loans – 4.0% to 5%
- 30 Year Loans –5.0% and Up
Once again, these commercial mortgage refinance rates are not static. There are many different types of loans, there are many different loan lengths, there are differences in fees and risk assessment and so much more. You may come across better rates or worse rates depending on the information you provide, or you may find that your rates are still high and it’s not worth refinancing.
Generally, it is best to refinance your commercial loan when you can save 1 to 2% of the refinancing costs. That tends to be the point where the value of refinancing outweighs the fees. You should also only refinance if you do not plan on selling the property soon, because it takes usually a few years to see a long term savings as a result of refinancing.
Still, there are some good rates available for those ready to refinance their commercial mortgage, and those that can save that 1 to 2% or more are encouraged to refinance soon. If you’re interested in learning more about your commercial mortgage refinance rates and options, sign up with CRE Lender today. Our company has helped countless property owners like you refinance commercial loans and see a profit off their investment. Sign up today.
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