Opinion: What business owners should know about refinancing in 2026

Hunter Cox

In 2021 and 2022, commercial borrowers were locking in rates many thought they might never see again. For a lot of businesses, refinancing was the obvious move. The numbers worked, and fixed payments gave owners some predictability during a period that felt uncertain.

Now those loans are beginning to mature.

Rates have come down from their recent highs, but they remain well above what many businesses secured four and five years ago. For business owners with loans resetting in 2026 or 2027, the change is pretty simple: The math just isn’t the same.

A loan that worked comfortably at 3% may feel tight at 6%. That doesn’t mean a business is struggling. It means the cost of capital has changed and cash flow is typically where that change shows up first.

Today, lenders are evaluating debt service coverage based on current rates, not prior ones. Business owners should take the same approach. Reviewing the past 12 to 24 months of financial performance and running projections with higher payments can clarify how much margin exists. If labor costs have risen or revenue has leveled off, those realities should be factored in before a refinance discussion begins.

Equity carries more weight now as well. During the low-rate cycle, rising asset values often supported transactions. Today, liquidity and overall leverage receive closer attention. Strong balance sheets and accessible cash reserves create options. Limited working capital limits flexibility.

For commercial real estate borrowers, updated valuations are also part of the process. Springfield and the surrounding region have remained more stable than many larger office markets, particularly in industrial and owner-occupied properties. Even so, appreciation has moderated. Refinancing decisions are being based on current fundamentals, not peak pricing from several years ago.

On the commercial and industrial side, lenders are paying close attention to operating trends. Inventory management, receivables aging and customer concentration are familiar metrics, but they are under renewed scrutiny. Clear reporting and consistent communication can prevent surprises late in the renewal process.

The broader local economy provides additional context. Data from the U.S. Bureau of Labor Statistics show the Springfield metropolitan area continued to post year-over-year employment growth through 2025, even as national growth slowed. At the same time, surveys from the Federal Reserve Bank of Kansas City indicate banks across the 10th District are maintaining tighter credit standards than during the low-rate cycle. A stable economy and disciplined lending can exist at the same time.

Timing also matters. Productive refinancing conversations typically begin six to 12 months before maturity. Waiting until a note is within weeks of renewal limits flexibility. Early discussions allow time to evaluate fixed and variable options, adjust amortization if necessary or restructure multiple facilities into a more sustainable plan.

Refinancing in this cycle is less about negotiating a headline rate and more about building the right structure. Full-service commercial banks can evaluate the broader relationship, from operating lines to treasury management. In some cases, consolidating debt or rebalancing credit facilities strengthens a company’s long-term position more than a simple renewal would.

Southwest Missouri businesses have built a reputation for steady growth and disciplined management. That approach serves borrowers well in today’s environment. Capital remains available for companies that understand their numbers and prepare in advance.

The rate environment looks different than it did four years ago, but preparing for it still comes down to the same fundamentals.

Hunter Cox is a senior vice president and loan officer for OMB Bank in Springfield. He can be reached at h.cox@ombbank.com.