A Commercial Mortgage is a Mortgage loan using the commercial property as security to secure repayment.
A commercial mortgage is similar to a Residential Mortgage except the security is a commercial building or other business property, not residential property. In addition, commercial mortgages are typically taken on by businesses instead of individual borrowers. The borrower may be a partnership, incorporated business, or limited liability corporation (LLC), so assessment of the creditworthiness of the business can be more complicated than is the case with residential mortgages.
Frequently, the mortgage is supplemented by a general obligation of the borrower or a personal guarantee from the owner(s), which makes the debt payable in full even if foreclosure on the mortgaged property does not satisfy the outstanding balance.