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Best Commercial Construction Loans

The best commercial construction loans provide ample borrowing amounts, sufficient term lengths, and competitive rates. Find out if these loans are the right fit for your construction project.

    Chris Motola
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Advertiser Disclosure: Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity.

Commercial construction loans are a common way to finance the cost of building, developing, or renovating real estate assets. If your business is in building or expansion mode, there’s a good chance a commercial construction loan will be best suited to the task. Commercial construction loans are, however, a specialized form of lending that isn’t available from all lenders.

Below, we’ll give you some of our best picks for commercial real estate loans and take a closer look at what commercial real estate loans are, how they work, and when they’re an appropriate solution for your business financing needs.

Learn More About Our Top Picks

CompanyBest ForNext StepsBest For
SmartBiz

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  • SBA loans, term loans, lines of credit, ERC refunds
  • FICO: 650+
  • APR: 6.99%+
  • SBA loans, term loans, lines of credit, ERC refunds
  • FICO: 650+
  • APR: 6.99%+

Apply Now

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Lendio

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  • Term loans, short-term loans, SBA loans, merchant cash advances, lines of credit, & equipment financing
  • FICO: No minimum
  • APR: Varies by lender
  • Term loans, short-term loans, SBA loans, merchant cash advances, lines of credit, & equipment financing
  • FICO: No minimum
  • APR: Varies by lender

Apply Now

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Fundbox

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  • Lines of credit
  • FICO: 600+
  • APR: 4.66% (borrower fee)
  • Lines of credit
  • FICO: 600+
  • APR: 4.66% (borrower fee)

Apply Now

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Fora Financial

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  • Short-term loans, merchant cash advances
  • FICO: 500+
  • APR: 10% (flat fee)
  • Short-term loans, merchant cash advances
  • FICO: 500+
  • APR: 10% (flat fee)

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National Business Capital

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  • Term loans, lines of credit, equipment financing, SBA loans
  • FICO: 580+
  • APR: 7%+
  • Term loans, lines of credit, equipment financing, SBA loans
  • FICO: 580+
  • APR: 7%+

Apply Now

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National Funding

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  • Short-term loans, equipment financing
  • FICO: 600+
  • APR: 17%+ (flat fee)
  • Short-term loans, equipment financing
  • FICO: 600+
  • APR: 17%+ (flat fee)

Apply Now

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Funding Circle

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  • Term loans, lines of credit, SBA loans
  • FICO: 660+
  • APR: 499%+
  • Term loans, lines of credit, SBA loans
  • FICO: 660+
  • APR: 499%+

Apply Now

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Read more below to learn why we chose these options.

Table of Contents

7 Best Commercial Construction Loans

The best commercial construction loans provide ample borrowing amounts, sufficient term lengths, and competitive rates. Many of the lenders on this list also offer SBA loans, which are often one of the best options small businesses can tap for construction capital. Here are the best commercial construction lender for 2023, including lenders like National Business Capital, Fundbox, Lendio, and National Funding.

SmartBiz: Best For SBA Loan Assistance

SmartBiz


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Pros

  • High borrowing amounts
  • Rates tend to be inexpensive
  • Long-term financing options available

Cons

  • Borrower qualifications might be hard to meet
  • Funds can take awhile to disburse

Why We Chose SmartBiz For Best Commercial Construction Loan

With SBA loans being a key source of commercial construction lending, SmartBiz’s specialization in SBA loans will come in handy for prospective borrowers. SmartBiz will guide applicants through the complex and lengthy SBA loan approval process and may even be able to help expedite it.

SmartBiz Services

SmartBiz offers the following products through its lending partners:

  • SBA loans up to $350,000
  • Bank terms loans up to $500,000
  • Lines of credit up to $150,000
  • Custom financing up to $500,000
  • ERC refunds

SmartBiz Rates & Fees

Interest rates for SBA loans range from 10.5% to 11.5%. Term loans have interest rates starting at 8.99%. Custom financing rates start at 6.99%.

SmartBiz Eligibility Requirements

SmartBiz’s eligibility requirements are as follows:

  • 2 years in business
  • Sufficient cash flow to support repayments
  • 650 credit score (for SBA loans)

Get Started With SmartBiz

Read our in-depth review

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Lendio: Best Marketplace For SBA Loans

Lendio


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Pros

  • Multiple types of financing are available
  • High borrowing amounts
  • Low credit score requirements (for some products)

Cons

  • Rates can be expensive
  • Funds can take awhile to disburse
  • The application process can be slow

Why We Chose Lendio For Best Commercial Construction Loan

Lendio allows businesses to apply to every lender within its network with a single application. Many of these lenders offer SBA loans. While SBA loan criteria is fairly consistent across lenders, Lendio can help you find one that is eager to work with you.

Lendio Services

Lendio offers nearly any type of funding you need for your business, including:

  • Short-term loans up to $500,000
  • Term loans up to $2 million
  • Lines of credit up to $500,000
  • Merchant cash advances up to $200,000
  • SBA loans up to $5 million
  • Equipment financing up to $5 million

Lendio Rates & Fees

Lendio’s rates and fees vary based on product type and the lender you select. Lendio has low-interest options such as SBA loans, as well as more expensive funding like MCAs for borrowers with bad credit or other challenges.

Lendio Eligibility Requirements

Lendio works with multiple lenders, and each lender has its own set of eligibility requirements for funding. However, Lendio recommends having a credit score of at least 550 to qualify. Additionally, the more revenue, higher credit score, and longer time in business you have, the better odds you have for qualifying for better rates and terms.

Get Started With Lendio

Read our in-depth review

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Fundbox: Best For Small, Quick Projects

Fundbox


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Pros

  • Fast and easy application
  • Discounts for early repayment
  • Funds are disbursed quickly
  • Few extra fees

Cons

  • Rates can be expensive
  • Repayments are required frequently

Why We Chose Fundbox For Best Commercial Construction Loan

Fundbox doesn’t offer what would be considered a typical commercial construction loan. What is does offer is a quick and flexible line of credit and a history of funding smaller construction and renovation projects. If you need a scalpel instead of a hammer, give Fundbox a look.

Fundbox Services

Fundbox offers lines of credit up to $150,000 with term lengths of 12 or 24 weeks.

Fundbox Rates & Fees

Fundbox’s borrowing fee starts at 4.66%. There is no draw fee.

Fundbox Eligibility Requirements

Fundbox’s borrowing requirements are as follows:

  • 6 months in business
  • 600+ credit score
  • $100,000 per year in revenue

Get Started With Fundbox

Read our in-depth review

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Fora Financial: Best Alternative Loan For Construction Companies With Poor Credit

Fora Financial


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Pros

  • High borrowing amounts
  • Discounts for early repayment
  • Fast and easy application process
  • Funds are disbursed quickly

Cons

  • Rates can be expensive
  • Some additional fees charged
  • Repayment are required frequently

Why We Chose Fora Financial For Best Commercial Construction Loan

Fora Financial’s short-term business loans generally won’t be the best construction solution for most companies. However, they can be a great tool for construction companies that are themselves doing the work. Fora Financial offers high borrowing amounts which can be use to cover cash flow shortfalls during the construction process until the contractor receives payment from its client.

Fora Financial Services Services

Fora Financial offers short-term loans and merchant cash advances up to $1.5 million with terms of up to 15 months.

Fora Financial Rates & Fees

Fora Financial’s flat fees range from 10% to 30% of the amount borrowed. An origination fee of 1% – 4% is also charged.

Fora Financial Eligibility Requirements

Fora Financial’s borrower qualifications are as follows:

  • 6 months in business
  • 500+ credit score
  • $15,000 per month in revenue

Get Started With Fora Financial

Read our in-depth review

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National Business Capital: Best Advisory Service Commercial Construction Loans

National Business Capital


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Pros

  • High borrowing amounts
  • Application process is fast and easy
  • Funds are usually disbursed quickly (except SBA loans)
  • Customers have assigned account manager

Cons

  • Rates can be expensive
  • May require collateral

Why We Chose National Business Capital For Best Commercial Construction Loan

Like Lendio, National Business Capital is an aggregator service, meaning that you’ll apply to multiple lenders through a single application. For commercial construction loans, National Business Capital can provide both medium-term loans and SBA loans, as well as stop-gap solutions for construction companies. One of the biggest selling points for National Business Capital is that you’ll get an assigned account manager to guide you through the process.

National Business Capital Services

National Business Capital offers:

  • Medium-term loans up to $5 million
  • Business line of credit up to $5 million
  • Equipment financing up to $5 million
  • SBA loans up to $5 million

National Business Capital Rates & Fees

National Business Capital’s interest rates start at 7%. Interest rates for SBA loans currently range from 10.5% to 11.5%.

National Business Capital Eligibility Requirements

Here are the borrower requirements for National Business Capital:

  • 1 year in business
  • 580+ credit score
  • $120,000 per year in revenue

Get Started With National Business Capital

Read our in-depth review

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National Funding: Best Alternative Loan For Construction Companies With Fair Credit

National Funding


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Pros

  • Discounts for repaying early
  • Fast and easy application process
  • Funds are disbursed quickly

Cons

  • Rates can be expensive
  • Some additional fees charged
  • Repayments are required frequently

Why We Chose National Funding For Best Commercial Construction Loan

National Funding is one of the oldest and most established lenders in the business, and has decades worth of experience financing construction companies. Construction companies that need an infusion of cash to manage cash flow, hire more workers, or purchase equipment can quickly get a loan to cover their expenses.

National Funding Services

National Funding offers:

  • Short-term loans up to $500,000
  • Equipment financing up to $150,000

National Funding Rates & Fees

National Funding’s flat fees start at 17%. An origination fee of 1-3% is also charged.

National Funding Eligibility Requirements

National Funding’s borrower requirements are as follows:

  • 6 months in business
  • 600+ credit score
  • $250,000 per year in revenue

Get Started With National Funding

Read our in-depth review

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Funding Circle: Best For Small SBA Loans

Funding Circle


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Pros

  • Interest rates tend to be low
  • No prepayment penalties
  • Few additional fees

Cons

  • Borrower qualification may be hard to meet
  • Not available in some states

Why We Chose Funding Cicle For Best Commercial Construction Loan

Funding Circle offers some of the better business loan terms in the online lending market. It also offers SBA 7(a) loans, a cost-effective way to fund construction projects with long-term debt.

Funding Circle Services

Funding Circle offers:

  • Term loans up to $500,000 with terms up to 7 years
  • Lines of credit up to $250,000
  • SBA 7(a) loans up to $500,000 with terms up to 10 years

Funding Circle Rates & Fees

Interest rates for SBA loans currently start at 8%. Interest rates on term loans and lines of credit start at 4.99%.

Funding Circle Eligibility Requirements

Funding Circle borrower requirements are as follows:

  • 2 years in business
  • 660+ credit score

Get Started With Funding Circle

Read our in-depth review

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Methodology: How We Chose Our Top Picks

To build our lists of best business financing projects, Merchant Maverick reviews small business lenders and assigns ratings based on criteria like interest rates, term lengths, fees, borrower requirements, and customer reviews. We then compare aggregate scores.

For this list, we also considered the lender’s ability and willingness to finance construction projects. This includes both the business seeking a construction contractor and the contractors themselves, who may need a commercial bridge loan. Lenders offering quality access to SBA loans, particularly SBA 504 loans, were at an advantage in our scoring.

As always, we recommend that is list be used as a starting rather than an end point in your search for a quality lender.

Understanding Commercial Construction Loans

Commercial construction loans are used to cover construction, renovation, and acquisition of property. Traditional commercial construction loans work a little differently than your typical business term loan, although it is possible to cover construction costs with a variety of loan types.

Traditional commercial loans are disbursed in phases as the project progress, with interest only accumulating on the amount that’s been disbursed. Most traditional commercial loans also don’t cover 100% of construction projects, so be prepared to make a down payment or use a mezzanine loan.

Check out our deep dive into commercial construction loans for more information.

How To Choose The Best Commercial Construction Loan

When searching for a great commercial construction loan, you’ll want to keep in mind the size of the project, how quickly you need funding, and the resources you have available to use as collateral or downpayment. For many small businesses, an SBA 504 loan will be the best option for major construction projects. Others may be better served by bank loans or alternative loans.

Need a broader selection of business loans? Check out our picks for the best small business loans.

FAQs: The Best Commercial Real Estate Loans

What type of loan is best for construction?

For small business construction projects, many will be best served by an SBA 504, which has low down payments, interest rates, and reasonable credit score requirements.

What credit score is needed for a commercial loan?

While there are alternative lenders will to work with credit scores as low as 500, most lenders will want to see a credit score over 600, with better offers beginning around 660.

Can SBA loans be used for construction?

Yes, SBA 504 and 7(a) loans can be used to finance construction activities.

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Chris Motola

Chris Motola

Senior Staff Writer at Merchant Maverick
Chris has been writing about small business topics since 2003. In 2015, he joined Merchant Maverick, where he writes about business financing, payment processing, and demographic trends in entrepreneurship. Chris has been featured in Fox Business, ABC News, Yahoo Finance, GoBankingRates, Newsweek, BizJournals, and other publications. He has a Bachelor’s of Arts in English Writing Arts from SUNY Oswego, and a Masters of Science in Interactive Media from the University of Central Florida. He currently resides in the Hudson Valley region of New York.
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