Are loans secured by commercial real estate considered small business loans?
A2. Yes, depending on their principal amount. Small business loans include loans secured by “nonfarm nonresidential properties,” as defined in the Call Report and TFR, in amounts of $1 million or less. ยง 345.12(v)–3: Are loans secured by nonfarm residential real estate to finance small businesses “small business loans”? A3. Applicable to banks filing Call Reports: Typically not. Loans secured by nonfarm residential real estate that are used to finance small businesses are not included as “small business” loans for Call Report purposes unless the security interest in the nonfarm residential real estate is taken only as an abundance of caution. (See Call Report Glossary definition of “Loan Secured by Real Estate.”) The agencies recognize that many small businesses are financed by loans that would not have been made or would have been made on less favorable terms had they not been secured by residential real estate. If these loans promote community development, as defined in the regulati
