OOCRE

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Owner-occupied commercial real estate (OOCRE) is when a business owns the building it uses to operate, instead of renting from someone else. This usually includes spaces like offices, factories, or retail spaces used by the owner’s company. Unimproved land and residential properties like multifamily or rental homes are generally not considered OOCRE by banks. OOCRE is different from commercial investment property. With investment property, lenders focus on the rent income from tenants to determine the loan terms. For OOCRE, the loan is typically based on the business’s overall finances, because the business’s cash flow should cover the loan payments. Loan terms vary by lender and depend on factors such as the business’s health, the amount borrowed, and the collateral involved.