Commercial Mortgages

Funding for either property developments and commercial purposes is still accessible.

A commercial mortgage in theory operates in the same way as a residential mortgage; ie the Mortgage Lender will want to assess you to ensure you have the means to repay the loan but the mortgage is taken out in the name of the business or in the name of the investor and figures borrowed may be based on the income of the individual or the business.

The Yes Specialist Mortgage Services team can source competitive rates across the commercial market space; we have built good relationships with specialist mortgage lenders who do not have a presence on the traditional high street and can therefore secure funding when other traditional routes may not be accessible or feasible for you.

 

In some cases this means we will help with either arranging bridging finance or for development finance for the specific purpose of building a new property (or making major changes to an existing one.)

A commercial mortgage is a mortgage loan secured on any property which is not your residence. There are a variety of different commercial mortgages and the assessment and pricing for each type will vary according to the risk surrounding the property purchase.

In many cases, individuals purchasing a commercial property will utilise a commercial property mortgage but possibly in conjunction with a business loan in order to offer additional financing to secure the property they need.

So depending on how you plan to use the property will dictate the type of mortgage that is available to you, the interest rates available and the level of borrowing you can make. There are also different mortgages for commercial properties and owner occupied properties.

Costs

There are a number of fees in addition to stamp duty that will be payable as part of the commercial mortgage transaction. In the same way as a personal property mortgage, there will be legal fees, arrangement fees and administration charges all likely to be incurred.

Stamp duty is a purchase tax with varied rates payable based on the property’s price. To get the latest rates, we recommend you check the Government’s website for information on non-residential property stamp duty rates

Commercial Remortgaging

If you already own a commercial property, you may be considering remortgaging the property to release equity that can be re-invested back into the business or to get a better mortgage rate.

Re-mortgaging can be a very cost-effective way of financing a refurbishment / expansion of the business, because mortgage rates will typically be cheaper than other commercial finance options.

As per your personal property, you may wish to re-mortgage your commercial property to obtain a better mortgage rate / deal than your current existing mortgage. This is potentially valuable if you have had your current mortgage for some time. A remortgage will involve providing new figures, projections and a valuation which could result in you being offered the chance to secure a better deal and interest rate if your position has improved.

It may be possible to consolidate other debts into your commercial mortgage, and so remortgaging may give you a more manageable monthly payment (by spreading the repayment over a longer period.) However, you should be aware that you could pay more interest in the long-term.

Need more help or have any questions?

We need to be honest with you… Your home may be repossessed if you do not keep up repayments on your mortgage.