Commercial Finance
Commercial property finance can support the purchase or refinancing of premises such as a shop, office or warehouse. The assessment depends on whether your business will occupy the property or it will be let to another business.
Accounts, rental income, experience, the deposit and the property’s use can all affect the available terms. Ownership through an individual or a company also has legal and tax implications, so the finance needs to be considered alongside appropriate professional advice.
Explain the premises, location and intended use, including whether your own business or a tenant will occupy them. A property’s use affects the assessment; an ordinary residential mortgage is not a substitute for the appropriate commercial arrangement.
Trading accounts and business performance may be relevant for owner-occupied premises. An investment property may depend on rental income and lease terms. Lenders can also consider experience, credit history and the source of the deposit.
Personal ownership, a trading company and a property-owning company are different structures. Lending terms and potential guarantees need careful review. Obtain legal and tax advice before choosing a structure solely because a particular finance option appears attractive.
A finance offer does not replace the legal and practical checks on the premises. Your professional advisers need to understand the intended use, ownership structure and any lease arrangements. A property that looks suitable for the business can still have conditions or costs that affect the decision to buy or refinance.
Compare the deposit, repayment structure, interest and fees with the income expected to support the loan. Consider what would happen if trading reduced or a tenant left, rather than relying only on the strongest forecast. Commercial mortgages are not normally regulated by the Financial Conduct Authority, so do not assume the same protections as a residential mortgage. Any personal guarantee also needs independent consideration.
Property used as security may be repossessed if the borrowing terms are not met. Commercial mortgages are not normally regulated by the Financial Conduct Authority.
We’ll start with your circumstances and what you need from a mortgage, so we can explore the options available to you.
We’ll compare suitable deals from the lenders available to us and explain the repayments, fees and other costs.
If you decide to go ahead, we’ll guide you through your mortgage application and the information your lender needs.
A company may be an appropriate borrower, depending on the transaction and lender. The company structure, accounts, ownership and any guarantee requirements will need consideration. An accountant and solicitor should explain the implications; using a company is not automatically cheaper or a way to remove all personal exposure.
An outline of the property, price or value, intended use, deposit and borrowing requirement is useful. Include relevant accounts or rental information and any existing finance. The lender’s detailed requirements depend on the transaction, so an initial discussion is not a lending commitment.
No. Property types and uses are assessed differently, and lenders set their own restrictions. Give an accurate description of the premises and business activity before relying on a borrowing indication. Specialist property or mixed-use arrangements may need further investigation.
Your property may be repossessed if you do not keep up repayments on borrowing secured against it.
