CMBS loan closing costs
By Brad Beattie, Director, Capital Markets, Janover Capital LLC · Published
CMBS closing costs are the lender’s legal fees, third-party reports, any origination fee, title and survey, state recording or mortgage taxes, and your own counsel. Upfront reserves are a separate use of cash. In the 15 loans with published sources and uses in one 2025 conduit deal, closing costs ran 1.2% to 5.6% of total sources, and smaller loans paid the larger share.
What you pay, line by line
| Cost | Paid to | Scales with loan size? | Notes |
|---|---|---|---|
| Application or good-faith deposit | Lender | No | Funds reports and early legal; credited at closing; refund terms are in the application |
| Lender’s legal fees | Lender’s counsel | Partly | Borrower reimburses; ask for an estimate or cap |
| Appraisal, Phase I, property condition, seismic, zoning | Report vendors, via lender | No | Ordered by the lender; reliance on existing reports can save money |
| Origination fee, if any | Lender | Yes | A percentage of the loan where charged; negotiable |
| Rate buy-down fee, if chosen | Lender | Yes | An upfront fee for a lower rate (disclosed as a practice by Bank of America in the prospectus, p. 294) |
| Title insurance and endorsements | Title company | Yes | Lender’s policy; endorsements add cost |
| Survey | Surveyor | No | ALTA/NSPS survey certified to lender and title |
| Recording fees and mortgage or note taxes | State and county | Yes, where taxed | Varies by state; can be the largest item |
| Your own counsel | Your attorneys | Partly | Negotiates the loan documents, issues opinions |
| Entity formation, independent director | Vendors | No | Single-purpose entity setup; independent director on larger loans |
| Advisor or broker fee, if engaged | Advisor | Yes | Set in your engagement letter |
| Prepayment cost on the old loan (refinance) | Old lender or defeasance providers | Yes | Defeasance or yield maintenance; often the biggest number on a refinance |
State taxes are worth checking first. Florida, for example, levies documentary stamp tax of 35 cents per $100 on a recorded mortgage (Fla. Stat. 201.08(1)(b)) and a one-time intangible tax of 2 mills on obligations secured by Florida real property (Fla. Stat. 199.133), so on a $10 million loan the two together come to $55,000. Other states have their own mortgage recording taxes, and some have none. Ask your title company for the figure on day one.
Closing costs in 15 real loans
The BANK5 2025-5YR14 prospectus publishes sources and uses for its largest loans. Closing costs as a share of total sources:
| Loan | Purpose | Total sources | Closing costs | Share |
|---|---|---|---|---|
| Las Olas City Centre | Acquisition | $236.2M | $2.9M | 1.2% |
| Redmond Town Center | Refinance, cash out | $121.5M | $1.6M | 1.3% |
| 8044 Montgomery | Refinance, cash in | $65.2M | $1.0M | 1.5% |
| Harden Ranch Plaza | Refinance | $83.5M | $1.3M | 1.5% |
| Logan Cargo Park | Refinance, cash out | $120.0M | $2.2M | 1.8% |
| The Spiral | Refinance, cash out | $2,850.0M | $77.3M | 2.7% |
| Atlanta Galleria Hotel Portfolio | Acquisition | $72.6M | $2.2M | 3.1% |
| Sycamore Portfolio | Refinance, cash in | $49.9M | $1.7M | 3.4% |
| Box House Hotel | Refinance, cash out | $41.0M | $1.5M | 3.7% |
| 1401 H | Acquisition | $137.2M | $6.1M | 4.4% |
| Grand Plaza | Refinance, cash in | $193.6M | $10.2M | 5.2% |
| Township Apartments | Refinance, small cash out | $33.2M | $1.8M | 5.3% |
| Southeast Workforce MHC Portfolio | Refinance, cash out | $105.0M | $5.7M | 5.4% |
| Radius at Harbor Bay | Refinance, cash in | $216.1M | $11.8M | 5.5% |
| Hollyview Apartments | Refinance, small cash out | $31.0M | $1.7M | 5.6% |
Source: each loan’s sources and uses table in the BANK5 2025-5YR14 prospectus (424B2, filed April 2, 2025). The prospectus does not itemize “closing costs”, so the line can include prepayment costs on the old loan, rate buy-downs and taxes as well as fees. Reserves are excluded; they are a separate line.
What to take from it: even among large loans the range is wide, and the high end is driven by items like prepayment on the old debt and state taxes, not by lender fees alone. On a loan of a few million dollars, the fixed items (lender legal, reports, survey) weigh far more. CMBS loan minimum.
Reserves: cash at closing that is still yours
Lenders collect reserves up front and monthly: taxes, insurance, replacement reserves, immediate repairs, and on commercial property tenant improvements and leasing commissions. In the examples above, upfront reserves ranged from a few hundred thousand dollars to $26.7 million (Radius at Harbor Bay). Bank of America’s standards cite immediate repair deposits of 100% to 125% of the engineer’s estimate and environmental remediation reserves of 100% to 150% (prospectus, pp. 295 to 296). CMBS reserves.
How to keep closing costs down
- Get an itemized estimate before you sign the application: lender legal, each report, title, taxes. Ask for a cap on lender legal.
- Read the deposit terms. Know what is refundable if the lender changes terms or the loan does not close.
- Reuse reports where you can. Recent reports with a reliance letter can replace new ones.
- Compare all-in cost, not rate. A lower rate with an origination fee or buy-down can cost more over a five-year hold. The loan offer comparison tool does the math.
- Price the exit now. The costs that surprise owners most come later: defeasance, yield maintenance and assumption fees.
The items you need to deliver are on the CMBS loan checklist, and the process is in how to get a CMBS loan.
Questions people ask
How much are closing costs on a CMBS loan?
It depends on loan size, state taxes and what is counted. In the 15 loans with published sources and uses in the BANK5 2025-5YR14 prospectus, closing costs ran from 1.2% to 5.6% of total sources. Smaller loans pay a larger share because legal and report costs are largely fixed.
Who pays the lender's legal fees on a CMBS loan?
The borrower. The lender's counsel drafts the loan documents and the borrower reimburses the cost at closing, in addition to paying its own counsel. Ask for an estimate or a cap before you sign the application.
Are reserves part of closing costs?
They are a use of cash at closing, but they are still your money: the servicer holds them for taxes, insurance, repairs or leasing and releases them under the loan agreement. Prospectus sources and uses tables list reserves separately from closing costs.
Can closing costs be paid from the loan?
Yes, if the loan is large enough. In the BANK5 2025-5YR14 examples, closing costs are paid from loan proceeds alongside the payoff of the old loan, and any shortfall comes from the sponsor as equity.
Get a CMBS quote
Buying or refinancing stabilized commercial property? Send the deal to Janover Capital LLC and a capital markets advisor will reply within one business day.