Commercial Finance

• Public Houses & Nightclubs
• Restaurants
  Hotels
• Mixed Use Property
• Live/Work Units
• Property Development
• Care Homes & Nurseries
• Shops
• Offices
• Warehouses
• Land
• Vehicles/Fleet Finance 
• Asset Finance

Pubs

Property Development

Restaurants

Vehicles

Commercial Property Finance

Commercial business mortgages and commercial property finance is available from a range of commercial business and property finance needs. The mortgage will be secured against the commercial business asset and we can undertake a thorough search of the commercial business mortgage market to get the best mortgage deal for you.

We always start on the High Street as the obvious point, but often we find it is not the actual mortgage lender but the relationship we have with the commercial business managers at each lender which is important in ensuring the success with our commercial mortgage deals.

The High Street may not be the appropriate place if your deal is large or complex or the case has other challenges such as the requirement for funds quickly or you have a need for a self cert commercial mortgage. In these circumstances, we may use some of our private bank connections or you may find that we are recommending a foreign bank or offshore lender as the most appropriate financier for your project.

The Financial Services Authority does not regulate some forms of buy to let, commercial mortgages, secured loans, bridging finance, trusts and conveyancing.

How Much Are Commercial Business Mortgages? 

The pricing of commercial business mortgages is significantly more complicated than the residential market, and there are a number of different criteria used by lenders for setting the interest rate you’ll pay.

Unlike the residential market, there is an ability to, at times, negotiate and that’s where we can add our greatest value to your transaction. The business mortgage rate will depend on numerous factors, not just current mortgage interest rates, but also the track record of the mortgage borrower, the credit history of the commercial mortgage borrower (and that of any commercial tenant, if you are letting the business property), whether you are full status or require a self cert commercial mortgage, the past and projected performance of your business, and often it is dependant on any additional security you can offer.

The use of a personal guarantee or otherwise can assist us in negotiating the actual commercial business mortgage rate you will be offered and more so for those requiring a self cert commercial mortgage, when they are usually compulsory. 

Commercial business loans are commercial transactions and they are all determined differently depending on the circumstances of the commercial business. The actual mortgage you pay is therefore negotiable and we will assist you through this process. 

Commercial Business Mortgage Lenders 

At Capital Fortune we know our lenders and we know our criteria. Once we get to know you we will know which lender is right for you at what rate. 

In looking at your commercial business mortgage needs we will assist you to present your commercial business mortgage application in the best light.  

Commercial Business Mortgage Applications

Most commercial business mortgage lenders will request a lot of information when you apply for a Commercial Business Mortgage. We will recommend preparing this from the start in order to process your application smoothly. The stronger the application is presented the greater the chance of success. The business information might include commercial documents on the performance of the commercial business, such as:

• Business accounts for the last 2 to 3 years (not self cert commercial mortgage)
• A profit and loss forecast for the next few years
• Current business performance
• Personal details of the business owners for credit-checking
• Asset and liability statements for the commercial business and for each Applicant

Business plans detailing how the commercial property will contribute to your cash flow and how you plan on repaying the loan will also be helpful and we are able to assist you in the preparation of these documents. The main concern of any commercial business mortgage lender is whether you can afford to repay the loan. They are also concerned, in the event that you default, whether the business property will have sufficient value to cover the commercial business mortgage.

In the event that you are buying a commercial property and a business together, you may need to provide additional information, such as the:

• Credit status of the business
• Reasons for the business  being sold
• Growth projections for the business.
• Repayment of  the mortgage

The commercial business mortgage lender will also want information about your business and will be looking to see if it is profitable. It will need to be in profit in order to obtain the mortgage as the commercial loan will need to be affordable.  They may request your business accounts and projections to test the business track record and that it is not under any immediate financial pressures.

Commercial Business Mortgage Terms

Commercial business mortgages can be anything from 1 year to 25 years and beyond. Like with a home mortgage the commercial business premises will be at risk if you are unable to keep up your repayments. The majority of mortgage lenders offer commercial mortgages, but it's important that you can meet their business mortgage lending criteria.

What if I Have Adverse Credit?

Some lenders may still accept commercial businesses and applicants with adverse credit, but it does help us if you have a clean credit record. This will give us a greater choice and allow us to provide the best commercial deal for you.

It also assists if you can go full status but we can, in particular circumstances arrange a self cert commercial mortgage where you meet the lender’s and our own stringent criteria.

How Much Can I Lend?

Commercial business mortgage lenders will apply a loan-to-value ratio to the business mortgage and they will often require you to invest some of your own money into the business and commercial property.

The more of your own money you invest into commercial business, the more chance you will have of securing the mortgage. Typically lenders will lend up to 70% of the purchase price. Higher loan-to-value ratios may be available depending on the business proposition.

On a commercial business mortgage the mortgage repayment options are similar to those in the residential mortgage market, although you are likely to pay a slightly higher rate of mortgage interest, as commercial mortgages are generally seen as a higher risk to commercial business lenders. It helps to have a big deposit, as a deposit of less than 20% to 30% may mean you pay a much higher interest rate to offset the increased risk to the lender. In the event that you require a self cert commercial mortgage, the level of deposit may need to be further increased.

Commercial Business Mortgage Restrictions

Some commercial business mortgage lenders may also impose restrictions on the commercial property, such as the ability to sub-let to other commercial businesses. You should therefore seek proper professional advice from your solicitor, and if required, a chartered surveyor.

Commercial Business Mortgage Rates

In the commercial business mortgage market, the majority of deals are either fixed rate or variable rate. Fixed rate mortgages are usually between one and five years but they can be extended to 25 years and can provide you with a significant degree of repayment stability if this is required.

On a fixed commercial mortgage you won't however, be able to take advantage of any falls in the base rate. In contrast, whilst taking a variable rate mortgage will allow you to benefit from any reductions in the base rate, it will mean that the risk of the repayments increasing if  base rate increases will also rise.

Commercial Business Mortgage Repayment

Again with a commercial business mortgage, the specific repayment options available are similar to those found in the residential mortgage market. A repayment mortgage option (where you pay the capital and interest back each month) means you will have all your bases covered in repaying what you have borrowed.

You can also choose an interest-only mortgage, where you only repay the interest back each month on the amount you have borrowed. If you choose this option, the lender will almost certainly seek evidence of an appropriate insurance or investment policy that will cover the outstanding capital at the end of the loan term.

Commercial Business Mortgage Costs

There are additional costs associated with taking out a commercial business mortgage and you will need to take these into account. Most commercial business mortgages come with lender fees and these can be anywhere from 0.5% and 2% of the total loan value.

There will also be valuation fees which will need to be met due to mortgage lender undertaking a survey on the business property to establish its value. In addition, there will be legal fees for both you and the lender, including legal advice costs, conveyancing, documents, insurance and your own surveys.

Finally, if you require commercial mortgage advice, from Capital Fortune, there will be a fee, the precise amount of which will depend on your circumstances but we estimate that it will be 0.5% of the mortgage amount.

These all need to be assessed and accounted for within your budget and our Advisers will be able to give you advice and assist you with this.

Commercial Business Mortgage Advice

To discuss your Commercial Business Mortgage or Commercial Property Finance needs call us on 0845 3 630 430 and ask for the Commercial Business Mortgage team or Enquire Online.