If you are interested in learning about commercial loan rates offered by banks, then the Wall Street Journal (there’s a link to the exact page on their website below) is your best bet.
Just be ready for to absorb a lot of information, because commercial loan rates come in all shapes and sizes, ranging from bond yields (discussed below) to international rates and commercial paper rates, which are often based on factors like inflation and foreign currency exchange rates.See commercial loan rates at this page on the Wall Street Journal Online.
There absolutely is an average commercial loan rate, but that rate might not be what you expect. In order to get an answer that satisfies you with respect to average commercial loan rates, you need to parse the question. For example, do you want to consider bond rates in the calculation? If so, what type of bonds? Bonds are rated from AAA (the best) all the way down to B and below, which is considered a junk bond rating. Commercial loan rates on bonds,or yields, vary accordingly.
Commercial Loan Rates Today
If you are curious to know what commercial loan rates today are, you need to look no farther than the Wall Street Journal. The financial section is full of information on the Fed Funds Rate or “overnight rate,” LIBOR, and the Prime Interest Rate. To get a feel for where commercial loan rates are today, LIBOR is a good place to start, as it is traditionally less prone to rapid fluctuation and a general representation of cheap loans. Of course, loans are almost never extended at LIBOR or Prime rates, but you can get a feel for commercial loan rates by adding a couple of “points” to those figures. Of course, any calculation of commercial loan rates for any specific transaction will be based on a number of factors such as the borrower’s reputation, security or collateral offered to secure the loan, the loan term, and whether business entity or guarantor loans are at issue. Things like equipment, real estate, inventory, and accounts receivable are all suitable assets to secure commercial loans.
Commercial Real Estate Loan Rates
Commercial Real Estate Loan Rates are likewise tied to well-known interest rate indexes like Fed Funds or LIBOR. It’s literally impossible to give an accurate estimate of commercial real estate loan rates without identifying a term. Generally speaking, the longer the term for repayment, the lower the interest rate. Some commercial real estate loans have terms of 99 years! It is very safe to say that commercial loan rates are a complex subject. I spent two years of my college education studying bond yields to get an understanding of the concepts involved. I can tell you from experience that there are some professional financiers that don’t even know what’s going on (though not the good ones).