CMBS Loans

CMBS loans are another major source of mortgage capital for multifamily investors. CMBS loans, otherwise known as commercial mortgage backed security loans, market through Wall Street investment banks. CMBS lenders make individual CMBS loans to borrowers which are then packaged and sold to investors as securities. CMBS loans provide interest rate yield to their investors while contributing liquidity to the capital markets. This liquidity in the markets means lower commercial mortgage rates to borrowers. Borrowers are well served when there are multiple sources of capital in the market.

CMBS Loan Rates - Rates updated February 7th, 2023

Loan Product Starting Rates LTV
10 Year Fixed Rates 5.47%-6.53% Up to 75% Get Free Quote
CMBS loan CMBS Loans

CMBS Loan Outlook 2022

As interest rates have continued to soar throughout 2022, CMBS loan activity has significantly decreased- bringing the CMBS loan market back down from a tremendous year of origination volume in 2021. Across the country, lenders originated $20.6 billion in CMBS loans in the second quarter of 2022. That’s a decrease of a whopping 29% from Q1 2022. Even though interest rates have gone up, sellers have yet to change their expectations on sales prices. This has led to a market in which most properties simply don’t cash flow at max leverage. Many buyers have temporarily left the market, waiting for sellers to adjust their price expectations, as they want to maximize leverage on purchases.

The delinquency rate on CMBS loans slightly increased by 7 bps to 3.2% in June 2022. This was only the second time in the last two years where the market has seen monthly increase in CMBS delinquencies. The last time was an increase of 16 bps in December 2021. It’s certainly too early to predict a delinquency trend, but many analysts to expect to see further delinquency rate increases in the CMBS loan market over the next few months.

CMBS Loan Benefits

There are many reasons for commercial real estate investors to consider CMBS loans. Here are some of the most important:

• CMBS loans are available to a wide array of borrowers- including those who may be turned down by traditional lenders.
• CMBS loans have less strict net worth and liquidity requirements than other lenders.
• CMBS loans are non-recourse. Borrowers don’t have to sign personally (except for standard bad boy carveouts).
• CMBS loans offer higher leverage than many traditional lenders. Borrowers can often qualify for 75-80% LTV with these loans.
• CMBS loans are assumable .
• CMBS loans often allow for more cash out financing than traditional lenders will allow

CMBS Loan Details


$2 million to $10 million+


Primary, Secondary, and Select Tertiary Markets


Multifamily, Manufactured Housing, Office, Retail, Industrial and Self-Storage


First Lien Mortgage


10 years


25 – 30 years






Fixed rate based on spread premium over 10-year US swap rates


Non-Recourse, except for standard industry carve outs


Permitted after a typical lock out period, subject to defeasance


Permitted, subject to Lender’s Approval and 1% assumption fee


3rd party costs & legal are capped


Real Estate Taxes, Insurance, Replacement Reserves, TI/LC (if applicable), and others as reasonably determined by underwriting

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