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Mortgages for commercial properties, property investment businesses and property developers
Mortgage loans can be divided into two categories:
Owner-occupier mortgages: This is used to buy property that will be used as trading premises for your business.
Commercial investment mortgages: This is used for property you’re planning to let out.
The interest on your commercial mortgage is tax-deductible
If your property increases in value, your capital could also see an increase
You’ll be able to rent out the property to generate extra income
A business mortgage plan differs from a regular mortgage in the following ways:
There are usually no fixed rates for commercial mortgages
You’ll usually pay a higher interest rate on commercial mortgages compared to regular home mortgages as these are considered higher-risk to lenders
Commercial mortgages tend to offer better interest rates than regular business loans as these require property as collateral
The mortgage is secured by a first legal charge on your business premises.
A commercial mortgage can be used for:
Buying property
Investment finance
Property development
Refurbishing owner-occupied business premises
Buying motor vehicles, machinery and other equipment
Most commercial mortgages are paid at a variable rate. Typically, a rate will be quoted as X% over base or LIBOR, and this in residential terms would be called a tracker mortgage. Fixed rate mortgages are available and for amounts under £500,000, where the lender takes the rate risk themselves, they may be advantageous.
The rates charged for commercial mortgages and business loans are not determined from the off-set like most personal loans are. Lenders usually have a risk profile that they work to, so if your loan falls outside their risk profile it will be refused.
You will certainly need a deposit for a commercial mortgage and this is likely to be a higher percentage of the total mortgage than a residential mortgage which can be as low as 5% deposit.
Commercial mortgage deposits tend to range from 20-40% of the loan.
We were approached by a broker; whose music producer clients wanted to expand their business by purchasing their own recording studio.
Our expert team was able to secure a commercial mortgage with:
No arrangement fee
No Early Repayment Charge (ERC)
77% Loan to value
A cross-charge over properties
Minimal deposit, strong accounts
Deposit from a Trust
A high street lender
Clever Lending helped a customer to achieve the following:
| Balance | Payment | Rate | LTV | Term | |
|---|---|---|---|---|---|
|
New Finance: Prop 1 |
£182,479 |
£1,063 |
6.99% Variable |
62% |
15 Years |
|
New Finance: Prop 2 |
£159,702 |
£695 |
5.99% Variable |
67.5% |
25 Years |
Use our callback form below to speak to one of our experienced brokers and find the best lender for your auction finance.
Use our live chat facility or speak to us on the phone, our expert team are here to help find you the perfect loan for your situation. 0800 316 2224
We are a broker, giving you access to the market for short-term finance. We deal direct with the lender and handle the application process for you.
This a loan you can use to buy a new property that you need to renovate before re-selling or renting on the market. You can use bridging to release equity you have in an existing property for up to 24 months.
You'll need a commercial mortgage if you're going to use the property for business purposes, e.g. as a shop.
This is finance to extend or make structural changes to an existing property, maybe converting a house into flats, or maybe you are looking to build from the ground up on land with planning permission.
Auction finance is a type of short-term loan that is used to finance the purchase of a property at auction. Auction finance is typically used by property investors and developers
Fund up to 100% of projects
We can help investors and developers secure up to 100% of their commercial property and property investment businesses projects
Solutions for complex cases
Each case is assessed individually, and a solution recommended according to the circumstances
Bad credit accepted
We have a flexible underwriting approach to applicants who have adverse credit
Hundreds of products
Commercial loans available from £50,000 with no maximum. Fixed and variable rates with up to 100% LTV
Not every case is the same
As each customer’s situation is unique, we’ll take the time to understand your situation, and we carefully assess your property finance requirements.
We can handle case directly
We will work with all parties to ensure you to get the right solution in place.
We are a credit broker not a lender.
© 2022 Financial Makeover Limited. This website is operated by Financial Makeover Limited. Clever Lending is a trading name of Financial Makeover Limited, a limited company registered in England and Wales with registered number 6111701. Registered Office: Kempton House, Dysart Road, PO Box 9562, Grantham, Lincolnshire. NG31 0EA. Financial Makeover Limited is authorised and regulated by the Financial Conduct Authority (FCA Register number: 706595).
Your initial consultation and any quotations are free and you are under no obligation to proceed with any options that may be available to you. If you choose to go ahead a fee will become chargeable. We will also be paid commission from the lender. The actual commission we receive will be confirmed in writing on your illustration.
Our calls may be recorded and monitored for training, compliance and complaint handling purposes.
Please note commercial mortgages and some buy to let and bridging loans are not FCA regulated products.