Commercial Property Finance FAQs

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Commercial Property Finance FAQs

Some of the most frequent questions and answers relating to Commercial Property Finance

Do you offer the best commercial mortgage rates available?

We are whole of market commercial advisers and we have excellent relationships with the majority of lenders.  Our knowledge of lending criteria and who offers the best rates to fit with your own situation is second to none.  We have excellent relationships with both traditional and specialist lenders allowing us to provide a truly independent and whole of market service.

Can I have the option of a fixed rate of interest ?

Fixed rates and interest rate management products should be available from most lenders, but these may vary depending on the amount and term you borrow over.
You should be aware that there are likely to be penalties, possibly significant penalties, for early repayment of all or part of the facilities under a fixed rate agreement as lenders have committed to the finance for the term of the fixed rate agreement.

I have a property owned by my pension. Would I be able to release additional equity from my fund?

Yes we can, the property will be held in a Self-Invested Personal Pension (SIPP), up to 50% of
the value of the property can be released and used for any legal business purpose.

Will you help me with the form filling and other paperwork?

Yes we will. We will assist you in completing the application form and provide you with a list of other documents that the lender requires. We will then collate all the paperwork, check it and then package the information before submitting it to the lender with our summary report.

How much can i borrow as a percentage of my property value?

Current loan-to-value ratio is normally up to 75%, but this will depend upon other factors including the industry sector, experience and credit history of the applicant, their ability to service the mortgage and the quality and type of the property.
We can help you raise your deposit and can potentially fund up to 100% of the finance though a full review of your business finance and background. Talk to our team to discuss how we can help raise the finance you need now.

 

Can I get a commercial mortgage on my commercial property to consolidate my debts?

Yes, if you own your commercial property and wish to arrange a commercial re-mortgage to consolidate your business debts, then we can look at this option as long as the additional funds are required for a legal purpose.

How long does it take to complete a commercial mortgage?

Typically the time scale is 6 – 8 weeks to include submitting the application, the offer being issued, the valuation being done and the respective solicitors completing their work. 

Are Interest Only Commercial Mortgages available?

Yes. Please ask for full details and a written illustration.

Interest only commercial mortgages tend to be offered by specialist lenders and may be at a higher rate than mainstream commercial mortgage lenders, although most high street banks will consider an interest only period for a short period.

What is the longest term I can borrow over?

The term can be arranged to suit your circumstances, 20 years is typical, but we can arrange up to 30 or even 35 years.

Will a bank lend for a leasehold property?

Lenders in this sector are used to lending for leasehold property so the straight answer is yes, subject to the usual caveats regarding serviceability etc.
The lender would want to know the terms of the lease and may want any onerous clauses removing. They would also warn you as to your commitments regarding continuance of paying rental if you stop trading and cannot sell the lease on.
You also need to consider the term of the lease, and if you are the first lessor. Also, are there any commitments at the end of the term i.e. that may require the lessor to convert the property back to the condition and layout when the initial lease was taken.
Lenders will expect the term of the lease or the remaining period of the lease to match the term of the loan.
However, most lenders would not see any security value in a lease unless it was long term – over 21 or even 35 years.

I may want to repay my mortgage early. Can I do this?

You should always be able to repay your loan/facility early. However, in certain circumstances early repayment may trigger early repayment penalties e.g. where you have a fixed rate, or where your interest rates/fees at start up or in the early years of the facilities are at a discounted rate.
Generally there are no penalties for early repayment of variable rate facilities. However, some lenders do impose penalties and you should always read the facility agreement before signing it. If unsure, you should ask the lender and/or consult a solicitor.

Lincoln Office: 01522 430707

Hull Office: 01482 635400

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