🏢 A Guide to Commercial Mortgages

Whether you’re buying your first business premises or expanding an existing portfolio, a commercial mortgage could be the key to your next step.

In this guide, we’ll explain what commercial mortgages are, how they work, and how a broker can help you secure the best deal for your circumstances.

💼 What is a Commercial Mortgage?

A commercial mortgage is a type of loan used to purchase or refinance property intended for business purposes. Unlike residential mortgages, these are tailored to suit the needs of businesses, investors, or landlords.

You might use a commercial mortgage to:

Buy an office, warehouse, or shop
Invest in a rental property portfolio
Refinance existing commercial borrowing
Purchase land for development

🧾 Types of Commercial Mortgages

There are several types of commercial mortgage products:

Owner-occupied commercial mortgages
For businesses purchasing their own trading premises.

Commercial investment mortgages
Used to buy properties that will be let out to tenants for rental income.

Semi-commercial mortgages
For properties with both residential and commercial elements (e.g. a flat above a shop).

💰 How Much Can You Borrow?

Loan amounts depend on:

The property’s value
The type of business
Your creditworthiness
Business accounts and cash flow

Typically, lenders offer 65–75% loan-to-value (LTV), though higher borrowing may be possible in some circumstances with additional security or a strong financial profile.

📋 What Will Lenders Look At?

Each lender has different criteria, but most will assess:

Business trading history (usually 2–3 years)
Profitability and affordability
Personal and business credit records
Property type and intended use
Deposit available (usually 25–35%)

For start-ups or businesses with limited trading history, specialist lenders may still be available.

🧑‍💼 Do You Need a Broker?

In most cases, yes.

Commercial mortgages are complex and highly tailored. Working with a broker helps ensure:

Access to lenders who specialise in your sector
A smoother application process
Stronger negotiating power on rates
Help preparing financial documents
Less time wasted with unsuitable lenders

🧾 What Will it Cost?

Interest rates for commercial mortgages are typically higher than residential ones and can vary based on risk.

Other fees include:

Arrangement fees (typically 1–2%)
Valuation and legal costs
Broker fees
Early repayment charges (if applicable)

A broker will help you understand the full cost of borrowing before you commit.

🏁 Ready to Get Started?

Whether you’re purchasing your first premises or restructuring your business finance, a commercial mortgage could be the tool to help you grow. Speaking to an expert is the best way to understand your options and find a deal that supports your business goals.

📞 Speak to a Commercial Mortgage Specialist

We’ll connect you with a trusted commercial mortgage advisor who understands your industry and funding needs.

✅ Compare lenders from across the market
✅ Get help presenting your business case
✅ Receive clear, personalised advice

Speak to a commercial specialist today – Enquire Here