Commercial vs Conventional loan: WWYD?

[Andrea Flores]

Tell me what you would do.

I am buying an STR and can pick between two lending options right now. I will detail both.

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1. The commercial loan: Borrowing $135,000 at 4.875% for a 5-year term, 20-year amort, with closing costs being $2,000. 

Monthly payments would be around $881/mth. The interest rate will fluctuate based on the market every 5 years but let say it stays similar since I have always been able to get lower interest rates. Total P/I payments would be $211,400 at the end, plus the $2,000 closing (and let's say I have to pay this every 5 years to refinance) would be a total of $219,440.

2. The conventional loan: Borrowing $135,000 at 6.5% for the 30-year term, closing costs are around $4,950. 

Monthly payments here are around $853/mth. Total P/I payments would be $307,080 at the end, plus the $4,950 to close the first time around would equal a total of $312,030.

Conclusion:

From my math, even if I have to pay closing costs on the commercial loan every five years, I would still save around $100K going the commercial route. I just don't see the $30/month of savings going with the conventional to be worth the $100K in the end.  

Am I missing anything? Let me know what you would choose.