Traditional Financing
Conventional Commercial Loans — $500K to $50M with 15-30 Year Terms
Traditional bank financing for established businesses with competitive rates indexed to Treasury and SOFR. No SBA fees, closings in 30-45 days, and flexible structures for property purchases and refinancing.
$500K - $50M
Loan amounts available
15-30 Years
5- & 10-year fixed periods
30-45 Days
Typical time to close
Common Uses for Conventional Loans
Property purchases
Refinancing
Property improvements
Portfolio expansion
Cash-out refinance
Investment properties
Business expansion
Debt consolidation
Rates & Requirements
Loan Amount:$500K - $50M
Interest Rate:5/10-yr Treasury & SOFR + 1.5-4%
Term:15-30 yrs (5/10-yr fixed)
Down Payment:25-50%
Min Credit Score:600
Min DSCR:1.25
Funding:30-45 days
What Is a Conventional Commercial Loan?
A conventional commercial loan is traditional bank financing that is not backed by a government agency like the SBA or USDA. Because there is no government approval step or guarantee fee, conventional loans typically close faster — usually in 30-45 days — and give established businesses more flexibility in how the funds are used.
Pricing is tied to market benchmarks: rates are indexed to the 5- and 10-year Treasury and SOFR, plus a lender spread of roughly 1.5%-4% depending on the lender, the loan program, and your business and property profile. Loans are typically structured over 15-30 years with a 5- or 10-year fixed-rate period, for amounts from $500,000 to $50 million.
Conventional loans are underwritten primarily on cash flow. Lenders look for a debt service coverage ratio (DSCR) of at least 1.25, a credit score of 600+, and a 25-50% down payment. If you'd prefer a lower down payment and longer terms, compare an SBA loan instead.
Conventional vs. SBA Financing
Conventional loans trade a larger down payment for speed and flexibility; SBA loans trade a slower process for lower down payments and longer terms. Here is how they compare:
| Feature | Conventional | SBA |
|---|---|---|
| Loan amount | $500K - $50M | Up to $5M (7a) / $5.5M (504) |
| Down payment | 25-50% | As little as 10% |
| Time to close | 30-45 days | Several weeks |
| Government fees | None | SBA guarantee fee |
| Best for | Strong cash flow, faster close | Lower down payment, longer terms |
Explore SBA 7(a) and SBA 504 loans, or browse all commercial loan options.
Conventional vs. Commercial Loan vs. Commercial Real Estate — Which Do You Need?
All three can finance property, so the right pick comes down to how the loan is backed and what you are buying. Here is how to choose.
Choose a conventional loan when you want a non-SBA bank mortgage on a stabilized, cash-flowing property. With no government approval step or guarantee fee, these typically close in 30-45 days and are underwritten on the property's cash flow, in exchange for a larger down payment.
Choose a commercial loan when you need broader, general-purpose business financing — working capital, expansion, an acquisition, or equipment — rather than a mortgage tied to one building.
Choose commercial real estate financing when you are buying or refinancing income-producing property and want the full range of options — permanent, bridge, construction-to-perm, and SBA 504 — compared side by side.
Explore Related Financing Options
Compare financing options to find the best fit for your business needs
$500K–$50M+
Commercial Real Estate Loans
Financing for office buildings, retail centers, industrial properties, and mixed-use developments.
Learn more$500K–$25M
Portfolio Loans
Flexible lending from banks that hold loans on their own books with customizable terms.
Learn moreUp to $5.5M
SBA 504 Loans
Long-term, fixed-rate financing for commercial real estate and heavy equipment purchases.
Learn more$2M–$100M+
CMBS Loans
Commercial mortgage-backed securities for larger properties with non-recourse options.
Learn moreFAQ
Frequently Asked Questions
A conventional commercial loan is traditional bank financing not backed by a government agency like the SBA or USDA. These loans offer competitive rates, flexible structures, and faster closings for established businesses with strong credit and cash flow.
Conventional loans typically close faster, have fewer restrictions on use of funds, and carry no SBA guarantee fees. In exchange, they usually require a larger down payment (25-50%) and are underwritten on cash flow — lenders look for a debt service coverage ratio (DSCR) of at least 1.25. SBA loans offer lower down payments and longer terms but take longer to process.
Rates are indexed to the 5- and 10-year Treasury and SOFR, plus a lender spread of roughly 1.5%-4% depending on the lender, loan program, and borrower profile. Terms run 15-30 years with 5- or 10-year fixed-rate periods, and loan amounts range from $500,000 to $50 million.
Most lenders look for a minimum 600 FICO score, a debt service coverage ratio (DSCR) of at least 1.25, and a 25-50% down payment, supported by property and business financials. Strong, stable cash flow can offset other factors.
Conventional commercial loans typically close in 30-45 days — faster than a comparable SBA loan, since there is no government approval step. Timelines depend on the property type, appraisal, and how quickly documentation is provided.
Yes. Conventional commercial loans are commonly used for non-owner-occupied investment and rental properties, where the property's rental income supports the debt. Because these loans are underwritten on cash flow, lenders focus on the property's debt service coverage ratio (DSCR) of at least 1.25 alongside your credit and reserves.
Most conventional commercial loans require a 25-50% down payment, with the exact amount depending on the property type, your credit, and the strength of the property's cash flow. A larger down payment lowers the lender's risk and can help you secure better pricing. If you need a lower down payment, an SBA loan may be a better fit.
Possibly. Many lenders set a minimum around a 600 FICO score, but credit is only one factor. Because conventional loans are underwritten primarily on cash flow, strong, stable income and a debt service coverage ratio of 1.25 or higher can offset a lower score. A larger down payment also strengthens a borderline application.
Still have questions? Our loan experts are here to help.