We are able to help clients find a commercial mortgage whether they are a new start up business or have been trading for many years.
We have lenders that will accept 1 Years accounts and will accept any previous bad credit, such as Defaults or Court Court Judgements, that have been registered.
Our experienced commercial mortgage consultants have a large panel of lenders that we work with and we would be happy to help you.
Commercial mortgages often exist to pick up where business loan requirements become of a higher value. Lenders will offer secured and unsecured loans to businesses but once a higher loan amount is required, often above the £25,000 level then the costs of securing the loan against a property, be that personal or business, or securing Director guarantees, the sensible and cost effective option is to look at a commercial mortgage.
It is normal for a commercial mortgage lender to take up to 70% of the loan value as security for themselves. This is often by way of the commercial property itself. On occasions where the 30% initial payment is not available some commercial mortgage lenders will look at other property that has equity to cover the shortfall. This may be a Directors personal property.
Commercial Mortgages are usually available for periods between 3 and 25 years and are not usually considered to be viable or cost effective for periods less than 3 years. Other options for shorter term borrowing include bridging loans. Most commercial mortgages are variable rate with the rate percentage quoted over LIBOR. A good comparison on a personal mortgage would be a tracker mortgage that tracks base rate and is adjusted up or down according to interest rate fluctuations.
Interest rates on commercial mortgages are usually risk related. This means that the lender will look at each commercial mortgage application and asses a number of things that include the risk factor and exposure to the lender. There is a standard risk profile used by many commercial mortgage lenders and this is used to asses each application individually.
The amount available to borrow for a commercial mortgage varies with each application and the purpose of the loan. For example, buying an existing business with stock and goodwill elements making up part of the valuation and loan requirements will not be considered as strong and safe as an owner occupied building or commercial property with a stronger level of deposit.
Valuation fees are an essential element to a commercial mortgage application. Commercial properties by nature are often unique and individual and require an in depth valuation report that can start circa £500.
Arrangement fees for commercial mortgages are usually in the region of 1-2% of the loan amount and some lenders may charge what is called a commitment fee that covers all of their preparation work in the event that the loan is not accepted by the applicant for whatever reason.
To summarise, commercial mortgage applications are taken on individual merit and each case is assessed sympathetically towards the individual and their requirements. Please contact our team of specialist advisors for more information on commercial mortgages and we will answer any questions that you may have.
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Product Name: Mortgages
Product Description: Commercial Mortgages
Gary has been brilliant throughout the whole process. Very knowledgeable, helpful and efficient. The service provided as a whole, has been excellent, 10/10.