I spent January and February talking to lenders. Not one lender. Eight of them. Community banks, credit unions, CMBS shops, and agency lenders. I was pricing a deal and wanted to see the full menu.

What I found is a lending environment that looks nothing like 2021, and not much like 2024 either. The rules have shifted. The products have changed. And the investors who understand what lenders want right now are getting funded while everyone else is getting declined and blaming "the market."

Here's what the commercial and multifamily lending landscape actually looks like in 2026.

The Rate Environment

Let me just put the numbers on the table.

Conventional multifamily (5+ units): 6.25% to 7.25% depending on LTV, DSCR, borrower strength, and property class. The spread between best-case and worst-case is a full 100 basis points. That isn't noise. On a $1.5 million loan, 100 basis points is roughly $15,000/year in additional debt service.

Community bank portfolio loans: 6.75% to 7.75% with some outliers in both directions. Community banks are pricing based on their own cost of capital, which varies. Shop multiple banks. The difference between a relationship lender and a transactional lender can be 50-75 basis points.

CMBS (Commercial Mortgage-Backed Securities): 6.50% to 7.50% for fixed-rate, 5 to 10 year terms. CMBS is back after a slow 2023-2024, but the underwriting is tighter. They want cleaner properties, stronger sponsors, and higher occupancy than they did three years ago.

Agency (Fannie Mae/Freddie Mac): 5.75% to 6.75% for qualifying multifamily. Agency debt is still the cheapest money in the market, but the qualification requirements are strict. Minimum 90% occupancy for 90 days pre-closing. Minimum 1.25x DSCR. Borrower net worth equal to the loan amount. These aren't suggestions. They're hard requirements.

SBA 504 (for owner-occupied commercial): 6.00% to 6.50% on the CDC portion (fixed, 25-year term). The SBA product is underrated for investors who occupy part of their commercial space. If you have an office or operations center in a building you're acquiring, look at this option.

The bottom line: if you're underwriting a deal, use 7.00% as your base case and 7.75% as your stress test. If the deal works at 7.75%, it's a real deal. If it only works at 6.25%, you're betting on getting the best rate in the market, and that isn't a bet I want to make.

LTV Requirements

Loan-to-value ratios have tightened across the board. Here's what I'm seeing.

Multifamily acquisition: 70-75% LTV is the standard. Some agency lenders will still go to 80% on strong deals, but 75% is the working number for most borrowers. That means you need 25-30% down plus closing costs and reserves.

Commercial acquisition: 65-70% LTV. Lenders are more conservative on office, retail, and mixed-use. The post-COVID uncertainty around commercial space hasn't fully resolved, and lenders are pricing that uncertainty into their leverage.

Refinance: 65-75% LTV depending on property type and cash-out amount. Cash-out refinances are harder to get than rate-and-term refinances. Lenders want to know why you need the cash and what it's going to fund.

Value-add-playbook-for-b-and-c-class-multifamily) or rehab: 60-70% LTV based on as-is value, not after-repair value. Some bridge lenders will underwrite-a-multifamily-acquisition) to ARV, but the rate premium is significant, often 8.5% to 10%+ with points.

What this means practically: if you're buying a $2 million multifamily property, you need approximately $500,000 to $600,000 in equity, plus $40,000 to $60,000 in closing costs and reserves. The days of getting into a deal with 10-15% down on commercial property are largely over in this cycle.

What Lenders Want to See

I have been on both sides of the closing table enough times to know that lending isn't just about the property. It's about the borrower. And in 2026, lenders are more focused on borrower quality than they have been in years.

Liquidity

Lenders want to see cash or liquid assets equal to 6-12 months of debt service after close. Not before close, after. If you're putting every dollar into the down payment and will have $3,000 in your account after closing, most lenders will decline the deal regardless of how good the property looks.

This is the number one reason deals die in underwriting. The borrower qualifies on income, qualifies on credit, the property qualifies on DSCR, but there aren't enough post-close reserves to satisfy the lender's liquidity requirement.

Net Worth

Most commercial and multifamily lenders require borrower net worth equal to or greater than the loan amount. On a $1.5 million loan, you need $1.5 million in net worth. This includes real estate equity, retirement accounts, investment accounts, and other assets.

If you don't have the net worth, you need a co-signer, a key principal, or a guarantor who does. This is common in syndications where the GP may not have sufficient net worth individually but brings in a balance sheet partner who signs on the loan.

Experience

Lenders ask about your track record. How many units do you currently own or manage? How long have you been in real estate? Have you completed a project similar to this one?

First-time buyers aren't disqualified, but they face more scrutiny and may get less favorable terms. Having a property management company (like ours) lined up to manage the asset helps. Lenders want to know that someone competent is running the building, even if the borrower is new.

Property Performance

The property itself needs to demonstrate performance. Lenders want to see:

Trailing 12-month income and expense statement showing actual operating results

Rent roll showing current occupancy, lease terms, and rental rates

Occupancy history demonstrating consistent performance, not a one-month spike to 95% before listing

Maintenance and capital expenditure records showing the property has been maintained, not just operated

Properties with declining occupancy, increasing delinquency, or deferred maintenance get priced up or declined. Lenders aren't in the business of funding turnarounds at 7%. They want stable cash flow with predictable performance.

Loan Products Worth Knowing

Beyond the standard term loan, there are a few products that I see underused by small and mid-size investors.

Bridge Loans

Bridge loans are short-term (12 to 36 months), higher-rate loans designed for properties that need stabilization before qualifying for permanent financing. Rates range from 8% to 11% with 1-2 points at origination.

These are expensive, but they solve a specific problem. If you're buying a property at 75% occupancy and need 12 months to renovate units, push rents, and stabilize to 93%, a bridge loan funds the acquisition and rehab period. Once stabilized, you refinance into permanent debt at a much better rate.

The mistake I see: investors using bridge loans on properties that don't have a clear stabilization path. A bridge loan is a tool, not a strategy. If you can't articulate exactly how and when you will refinance into permanent debt, you shouldn't take on bridge financing.

DSCR Loans (Investor-Focused)

DSCR loans underwrite the property, not the borrower's personal income. They're designed for investors whose W-2 or tax return income doesn't reflect their actual financial position, which describes most serious real estate investors.

Rates are typically 50-100 basis points higher than conventional loans, but the qualification is simpler. The property needs to demonstrate a DSCR of 1.20x or higher based on actual or market rents, and the borrower needs a credit score above 680-700 with reasonable liquidity.

These products have expanded significantly in the last two years. If you have been told "you don't qualify" based on your tax returns showing low income because you're depreciating real estate, explore DSCR lending.

Seller Financing

This isn't a loan product from a bank, but it's a capital structure worth understanding. In a seller-financed deal, the seller acts as the lender, carrying back a note for a portion of the purchase price.

Seller financing is most common when: the seller owns the property free and clear, the property doesn't qualify for conventional financing, or the buyer can't meet traditional lending requirements.

Terms are fully negotiable. I have seen seller carry notes at 5% to 8%, with terms ranging from 3 to 15 years, and amortization schedules from 15 to 30 years.

The advantage is flexibility. The disadvantage is that the seller retains a lien on the property and can foreclose if you default. Treat seller financing with the same seriousness as bank debt.

The Takeaway for 2026

The lending landscape isn't broken. It's just demanding. Lenders are lending. Money is available. But the bar for qualification is higher, the terms are less forgiving, and the margin for underwriting error is thinner.

If you're planning to acquire in 2026, here's my advice:

Get pre-qualified before you start looking. Know your borrowing capacity, your rate range, and your equity requirement before you make an offer. Reverse-engineering the financing after you have a property under contract is a recipe for dead deals.

Build relationships with 2-3 lenders. Not brokers. Lenders. The direct relationship matters because it gets you faster answers, better terms on marginal deals, and a phone call when products change.

Stress-test at 7.75%. If your deal doesn't cash flow at the high end of the current rate environment, it isn't the right deal at the right price.

Bring post-close liquidity. The most common deal-killer I see is a borrower who puts every dollar into the down payment and has nothing left. Lenders won't fund that, and honestly, they shouldn't.

The rate environment will do what it does. You can't control it. What you can control is your borrower profile, your deal selection, and your underwriting discipline. In a tighter lending market, those three things separate the investors who close deals from the ones who talk about wanting to.

For weekly market insights and real operator perspective, catch the Freedom Fighter Podcast on Spotify, Apple, or YouTube.

Tanner Sherman is the Principal and Managing Broker of Top Tier Investment Firm in Omaha, Nebraska. He co-hosts the Freedom Fighter Podcast with Ryan of Avara Investments.

The Commercial Lending Landscape in 2026