Documents to prepare for a commercial real estate loan

Short answer

Most commercial real estate lenders ask for the same core file: trailing 12 months of operating statements, a current rent roll, the budget, capital spending history, insurance and tax bills, a schedule of real estate owned, a personal financial statement for each guarantor and the borrowing entity’s documents. Acquisitions add the purchase agreement and business plan, refinances add the current loan documents, and construction adds plans, the contract and the budget.

Acquisitions

Purchase agreement. The signed agreement and every amendment, with deposit and closing dates.
Offering memorandum. And the seller’s operating statements and rent roll if they differ from your underwriting.
Business plan. What changes after closing: rents, expenses, capital work and timing.
Sources and uses. Total cost and how it is paid for. Build one with the sources and uses builder.

Refinances

Current loan statement. Balance, rate, maturity and any reserves held by the lender.
Existing loan documents. Note, mortgage and any prepayment, defeasance or exit fee terms.
Payoff estimate. From the current lender or servicer, including prepayment cost at the expected closing date.
Use of proceeds. If you are taking cash out, what it is for.

Construction

Plans and specifications. The current set, with the architect’s contract.
Construction contract. A guaranteed maximum price or fixed-price contract, the contractor’s financials and references.
Development budget. Hard and soft costs, contingency, fees and an interest reserve. See hard and soft costs.
Construction schedule. From start to certificate of occupancy, with lease-up after that.
Entitlements and permits. Zoning approvals, site plan approval and building permit status.
Site reports. Geotechnical report, environmental report and any wetlands or traffic studies.
Stabilized pro forma. Rents, expenses and the return on cost, with market support.
Pre-leasing. For commercial projects, signed leases or letters of intent.

Bridge and value-add

Renovation scope and budget. Unit or suite by unit, with contractor bids where you have them.
Rent comparables. Support for post-renovation rents from nearby renovated properties.
Lease-up plan. Timing from start of work to stabilized occupancy, month by month.

Multifamily

Unit mix. Unit types, square footage, in-place and market rents.
Recent leasing. New lease and renewal trade-outs and concessions for the last six months.
Utility and other income. Billing-back programs and other income by month.

Office: retail and industrial

Leases. Every lease and amendment, with an abstract or summary of key terms.
CAM reconciliations. For the last two years.
Tenant sales. For retail tenants who report them.
Estoppels and SNDAs. Requested from tenants once the loan is in documentation.

Hotels

Monthly P&L by department. Trailing 12 months and two prior years.
STR reports. For the same period, against the competitive set.
Franchise and management agreements. With any open property improvement plan.

Self-storage

Occupancy and rate reports. From the management software, by unit type, for 24 months.
Street-rate survey. Nearby competitors and any new supply under construction.

Owner-occupied property

Business financial statements. Three years and the current year to date.
Business tax returns. Three years.
Lease between the property and the business. If the property is held in a separate entity.

Reports the lender orders

Appraisal. Ordered by the lender and paid by the borrower, usually from a deposit at term sheet.
Phase I environmental report. See what a Phase I covers.
Property condition report. Sets repair and replacement reserves.
Zoning report. Confirms the use and any nonconformities.
Survey and title. Updated for the new loan. See title and survey preparation.

At closing

Insurance certificates. Naming the lender, meeting its coverage requirements.
Entity resolutions and incumbency. Authorizing the loan and naming signers.
Legal opinions. From borrower’s counsel, where the lender requires them.

Tick items as you gather them. Your progress stays in this browser.

Tips that save weeks

Send native files. Excel for the rent roll and operating statements, PDF for leases and legal documents.
Use matching dates. A rent roll and a T-12 from the same month let the lender tie them together on the first pass.
Explain one-time items. A note on unusual income or expenses prevents the lender from normalizing them against you.
Send it all at once. A complete package quotes faster and keeps the quote from moving later. See preparing a loan package.

When the file is ready, the Deal Desk takes the details, and the term sheet comparison helps you weigh the quotes that come back.

Frequently asked questions

What documents do I need for a commercial real estate loan?

How many years of financials do lenders want?

The trailing 12 months by month plus the two prior calendar years is standard. Some lenders ask for three years, and construction lenders focus on the budget and pro forma instead.

Do lenders need personal tax returns?

Banks and credit unions usually want two to three years from each guarantor, especially on recourse loans. Non-recourse lenders focus on the personal financial statement, verified liquidity and the schedule of real estate owned.

Who pays for the appraisal and other third-party reports?

The borrower. The lender orders them so they are independent, usually from a deposit collected when the term sheet is signed.

What format should the rent roll and operating statements be in?

Excel exports from your property management or accounting system, with the same as-of dates, so the lender can tie the rent roll to the income on the operating statement.

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