A commercial mortgage is a loan secured on a property which is non residential to use as security. It can be split in to two categories. These are owner occupier mortgage and a commercial investment mortgage.
This mortgage is usually used for expansion within a business. It is done using your current premises as security to get a mortgage on a new one. It is borrowed using a percentage of the current property value to how much you are then allowed to borrow. This is usually between 65 and 75% of the current property value. It is also decided using the past and present performance of the business to see if you will have the funds available to be able to make the repayments.
The length of the mortgage is usually between 10 and 25 years. Also the loan can be very large sums of money so will take substantially longer to pay back. With most mortgage lenders the minimum amount they will loan is £25,000. However the maximum is flexible in order to suit your businesses needs.
However their can be a few added fees involved with this. Their can also be arrangement fees as well as valuation and security fees.
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The Financial Conduct Authority does not regulate some forms of Mortgages and Loans, including most types of Buy to Let mortgages and also Limited Company lending.
