Owner occupied commercial mortgages are a financial product for applicants that are looking to purchase a property to run their business from. Lenders look more favorably on owner occupied commercial mortgages when compared to other types of commercial mortgages as this kind of financial product is seen to have less perceived risk.
What is the maximum loan to value?
Lenders will look to offer up to 75% for a owner occupied commercial mortgage. You will need at least a 25% deposit or own another property that can be used as security. There are a wide range of lenders that will accept applications for this kind of mortgage from high street lenders to specialist lenders who are willing to consider applicants with a bad credit history.
Owner occupied remortgage
Our specialists are also able to help applicants who need to remortgage their current commercial property with rates of up to 80% available, depending on the lenders criteria. You may want to remortgage your commercial property to get a better deal or release equity to help with the growth of your business. The lender will work out the loan to value based on the value of the property itself. Some more specialist lenders can base the loan to value on a full business appraisal. Speak to one of our specialist commercial mortgage brokers to discuss your circumstances and get a tailored quote.
Owner Occupied Commercial Mortgage Criteria
Each lenders criteria is different and some can be drastically different. This is especially true when lenders are calculating affordability what may be affordable by one lender’s standards might not be by another. This is where experience is key, using an experienced broker that has knowledge of all lenders criteria is important and it will stop you potentially applying to lenders that reject your application.
Lenders criteria will look at the loan to value and also the affordability of the mortgage. To work out affordability each lender uses their own criteria but in general the lender will look at the net profit of the business over the last 3 years.
If your business is going through a period of growth and you are expecting this to continue some lenders will allow this to be counted when they are carrying out their affordability checks. When using projected income the figures must be realistic and any evidence such as new contracts or why you expect your business to grow will be needed. If your accounts show increases year on year this is a good sign for the lender.
If you are ready to progress with your commercial mortgage get in touch and speak with one of our experienced advisors. Commercial mortgages can be more complex than a traditional residential mortgage, affordability calculations can vary from lender to lender. Speak with someone with knowledge of the whole market to give your application the best chance of being approved.
Call us today or fill on one of our enquiry forms to get started