How will the building be used?
Owner-occupied and income-producing properties can follow different underwriting paths. Be clear about tenants, vacant space and any planned renovations.
Commercial Mortgages in Ontario
Financing an office, retail space or mixed-use building is different from buying a home. The lender may weigh the property's cash flow, leases and your business history alongside your credit and available capital. We start by identifying the property and the financing goal so you can approach suitable lenders.
Discuss your options
The property and the business both matter
For an owner-occupied building, explain how your business will use the space and support the payments. For an income property, lenders will want to see leases, vacancy, operating costs and the cash left after those costs. A mixed-use building may need a closer review of each part of the property.
The purchase price is only one part of the budget. Appraisals, environmental or building reports, legal work and lender fees can affect cash needed before closing. Financing terms also vary by property type, tenant mix and lender, so a residential mortgage rate is not a useful comparison.
A situation to consider
A building with a strong asking rent but empty units may be assessed differently from one with signed leases and a clear operating history. Prepare the actual rent roll before asking for terms.
What to check before applying
A useful comparison starts with your own numbers and plans.
What does the property earn?
For an investment property, prepare leases, operating expenses, taxes and a realistic view of net income. Gross rent is not the same as cash available for debt payments.
What are the total upfront costs?
Budget for valuation, environmental or building reviews, legal work and lender fees as applicable, in addition to your down payment.
Ways to approach it
Business-use purchase
Show how the premises supports your business and how the loan will be repaid.
Income-property purchase
Compare lenders using property cash flow, tenant quality and the proposed financing structure.
Commercial financing is assessed case by case. Do not make a purchase unconditional based on an indicative rate or a residential-mortgage estimate.
Compare the full cost before you decide
A Mortio mortgage specialist can review your circumstances and explain available lender options, rates, fees and trade-offs.