Getting a Commercial Real Estate Loan in an LLC
Most serious real estate investors hold their properties in LLCs for liability protection, tax flexibility, and estate planning purposes. But lending to an LLC instead of an individual raises questions — and some lenders make it harder than it needs to be. Here’s how commercial real estate loans in LLCs actually work in Texas.
Can an LLC Get a Commercial Real Estate Loan?
Yes — and for investment properties, it’s the standard. Commercial lenders routinely lend to LLCs, corporations, partnerships, and trusts. This is different from residential mortgage lending, where Fannie Mae and Freddie Mac require individual borrowers for their loan programs. Commercial loans have no such restriction.
What Lenders Require When Lending to an LLC
- LLC documentation: Articles of Organization, Operating Agreement, and Certificate of Good Standing from the Texas Secretary of State
- Authorized signer: The Operating Agreement must designate a member or manager with authority to execute loan documents
- EIN: The LLC’s Employer Identification Number (tax ID)
- Personal guarantee: Most commercial lenders — especially banks — require a personal guarantee from the principal members of the LLC. This is standard and expected.
- Entity age: Some lenders want the LLC to be at least 1 to 2 years old; others will lend to a newly formed LLC if the sponsor is experienced
Non-Recourse LLC Loans: Is a Personal Guarantee Required?
Not always. Non-recourse loans — where the lender’s only recourse upon default is the property, not the borrower personally — are available for larger commercial deals, typically through CMBS lenders and life insurance companies. Most CMBS loans above $2–3M can be structured non-recourse with standard “bad boy” carve-outs.
For smaller deals and hard money loans, personal guarantees are almost always required. Non-recourse hard money exists but is rare and comes at a significant rate premium.
Single-Member vs. Multi-Member LLC
Both can get commercial loans. The key difference:
- Single-member LLC: Tax-transparent (reported on your personal return); most lenders treat it like lending to an individual for underwriting purposes
- Multi-member LLC: Each member with 20%+ ownership typically must sign the personal guarantee and provide financial documentation
Series LLC in Texas
Texas allows Series LLCs — a single LLC with multiple series, each holding a different property. While useful for liability segregation, many commercial lenders are unfamiliar with them and prefer to lend to a standard single-purpose LLC. If you’re using a Series LLC structure, confirm your lender is comfortable with it before going deep into the process.
Best Loan Programs for LLC-Held Investment Properties
- Hard money loans: LLC-friendly, close fast, focus on the asset not the entity history
- Stated income commercial loans: No tax return requirement, works well for LLCs with complex income
- DSCR loans: Qualify based on property income, not personal income — ideal for LLC-held rentals
- Conventional commercial mortgages: Standard bank loans to LLCs with personal guarantee
Get a Commercial Loan for Your Texas LLC
Whether your LLC holds one property or twenty, we structure commercial loans to fit your entity and your investment strategy. No unnecessary friction, no requirements for two-year-old entities or specific LLC structures — we focus on the deal. Direct lender since 1998.
Apply Now — LLC Commercial Loan Pre-Qualification