Commercial Mortgage Glossary

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AAA Tenant
This refers to tenant with a top credit rating. This type of tenant is often critical to a developer's ability to arrange both construction and permanent mortgage financing for a major commercial project, such as a shopping center or office building. The more AAA Tenants you have, percentage-wise, the better your commercial loan rate will be.
Balloon Mortgage
Loan that features artificially low payments for a while-usually 3 to 5 years, with a large lump sum payment due at the end of the term. In mortgages, these loans feature level monthly payments that will fully amortize it over a specified period, but then there's a balloon payment that's due at an earlier time. Balloon mortgages are typically used by investors for property they expect to hold for only 3-5 years. When homeowners use them, they plan to refinance when the balloon comes due.
Common Area Maintenance. Charges for maintaining the common areas of a building, apartment complex, or condo development. Usually assessed monthly, quarterly, or annually.
Debt Service
Payments made on a commercial loan or real estate loan. Used to compute cash flow-debt service is subtracted from rents received from real estate investment property.
Earnest Money
A sum of money or other consideration give by a prospective purchaser to the seller as evidence of good faith along with an offer to purchase rights in real property. Often non-refundable, or with strict conditions on refunds.

Contact Caffrey & Company

11225 College Blvd., Suite 125
Overland Park, KS 66210
Telephone: (913) 402-7077


Current Rates (10/12/2017)

  • Apartments 4.26%
  • Mobile Home Park 4.26%
  • Anchored Retail 4.49%
  • Non-Anchored Center 4.79%
  • Single Tenant Retail 4.39%
  • Office 4.79%
  • Industrial 4.44%
  • Self-Storage 4.59%
  • Medical Office 4.34%
  • Hotel 4.69%
  • Owner Occupied 4.34%
  • Land 6.84%
  • Other 5.09%

Rates are based on a $2 million loan, 25 year amortization, 10 year fixed rate term. For apartment complexes, a 30 year amortization is available.


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