Property and business financing.
Plazas, vacant land, acreage and loans for businesses that are not buying real estate. Different lenders, different guidelines.
Four ways in.
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Plazas & retail
Strip plazas, retail and mixed-use buildings.Vacant land & acreage
Land for development, hold or build.Vacant land & acreage
- Vacant land and development land
- Acreages and other special-purpose properties
Business loans
Financing for businesses not buying property. Funding rests mainly on cash flow, time in business and the owners' credit.Business loans
- Working capital and lines of credit
- Equipment and vehicle financing
- Term loans for growth or renovations
- Business purchase or partner buyout
Office & industrial
Offices, warehouses, shops and rental buildings. The property and the income it earns secure the loan.Office & industrial
- Office, industrial and mixed-use buildings
- Properties bought or owned mainly for business or investment
Bring the full picture.
Each lender sets its own rules, so terms vary more than they do for homes.
General information. Loan amounts, rates, terms and fees depend on the lender and your circumstances, and nothing here is a commitment to lend.
Where CMHC insurance fits
CMHC doesn't insure every commercial loan. Its multi-unit mortgage loan insurance is for residential rental buildings with at least 5 units, including some mixed-use buildings with commercial space on the ground floor. Plazas, vacant land, acreages and other purely commercial properties are financed through conventional (uninsured) commercial lending instead.
| CMHC multi-unit insurance | Standard rental housing | MLI Select (up to) |
|---|---|---|
| Minimum size | 5 rental units | 5 units (50 for retirement homes) |
| Maximum loan-to-value | 85% | 85% to 95%, depending on points |
| Minimum debt coverage ratio | Set by CMHC | 1.1 |
| Maximum amortization | 40 years existing, 50 years new construction | 40, 45 or 50 years, depending on points |
- Commercial space: at least 70% of the building (floor area and loan value) must be residential. The non-residential part can be financed up to 75% of its value, with a 1.00% premium surcharge on that portion.
- Borrower: proven experience managing a similar property, normally at least 5 years, and net worth of at least 25% of the loan.
- MLI Select: higher loan-to-value and longer amortization are available when a project earns points for affordability, energy efficiency and accessibility.
Sources: CMHC, standard rental housing and MLI Select. CMHC changes its programs from time to time, so these figures are a summary to be confirmed against current CMHC criteria and the lender. Not every lender or project qualifies.
What to have on hand
- For a business loan: business financial statements, tax returns, recent bank statements and what the funds are for
- For a property: the address or land description, purchase agreement or current mortgage, and how the property will be used
- For rental income: leases, rent roll and operating expenses
- Your personal net worth statement and ID
Not sure which category your plan falls in? Book a call and we'll sort it out together.
Have a deal in mind?
Send me the basics and I will tell you which lenders fit.