Commercial Mortgages
Are you looking for capital to support the purchase, remortgage, or investment in commercial property? A commercial mortgage with i10 Networks could provide the ideal solution for your needs.
What is a Commercial Mortgage?
Commercial mortgages are specifically designed for individuals or businesses looking to purchase property for business or investment purposes. At i10 Networks, we offer two primary types of commercial mortgages:
- Owner-Occupier Mortgage: This is suitable for individuals or businesses purchasing property with the intention of operating from it, while also securing an investment asset.
- Commercial Investment Mortgage: Designed for those seeking to invest in commercial property and generate income through rental.
Our commercial mortgages can be structured in various ways to best suit your investment strategy, including onshore or offshore, under a company name, LLP, trust, or personal name.
What can Commercial Mortgages be used for?
Commercial mortgages can serve a wide range of purposes, and at i10 Networks, we specialize in crafting solutions for various real estate investment needs, including:
- Owner-Occupied Commercial Premises: Such as units, warehouses, and shops.
- Commercial Investment Properties: Properties purchased for rental income.
- Mixed-Use Properties: Typically properties with a commercial unit on the ground floor and residential space above.
- Large HMO Properties: Generally, properties with 10+ bedrooms.
- PBSB (Purpose-Built Student Blocks): Student accommodation blocks specifically designed for student living.
- PRS Blocks (Private Rented Sector): Residential blocks for private rental.
- Portfolio Lending: Cross-charging across multiple properties.
Our team’s expertise in the commercial mortgage market ensures that we match you with the most suitable lender and guide you every step of the way, from application to completion.
Key Considerations
Before applying for a commercial mortgage, it’s essential to consider several factors, including affordability, deposit requirements, potential impacts on your business, and the long-term outcomes of securing the mortgage.
Affordability
Lenders assess whether the commercial mortgage and its repayment terms are affordable, much like a standard residential mortgage. However, instead of evaluating personal income, they focus on your business’s earnings before interest, taxes, depreciation, and amortization (EBITDA) to determine affordability.
Commercial Mortgage Deposit Requirements
The deposit requirements for a commercial mortgage typically differ from residential mortgages, with higher loan-to-value (LTV) ratios being less common. The required deposit may depend on several factors, including:
- The Property: Its type, condition, and location.
- Potential or Current Rental Income: The projected revenue from tenants.
- Borrower/Tenant Strength: Financial stability and credibility.
- Affordability (for owner-occupied properties): Your business’s ability to sustain repayments.
Since mortgage market conditions can fluctuate, reaching out to an advisor ensures you receive the most up-to-date information tailored to your needs. You can request a callback at your convenience, or message us, and we’ll respond within hours.
Applying For A Commercial Mortgage
To begin, schedule a consultation with one of our commercial mortgage advisors. During this initial meeting, we’ll take the time to understand your business and your goals for a commercial mortgage. Once we have a clear understanding of your requirements, we will source the best mortgage options from the market.
We’ll walk you through the terms and conditions of the mortgage, outlining the necessary documents the lender will require. From there, your advisor will manage the application process and submit it to the lender on your behalf. You’ll be kept informed throughout the process, and once completed, you’ll have access to your funding.
Throughout the process, our team is here to answer questions, assist with paperwork, and ensure you are fully informed.
Commercial Mortgage Eligibility
Eligibility for a commercial mortgage differs between investment and owner-occupied mortgages, primarily based on the source of repayment. For an investment commercial mortgage, lenders expect repayments to come from the property’s rental income. For owner-occupied mortgages, repayments are expected from the income or profit generated by the business operating within the property.
Lenders accept a variety of business structures, including:
- Limited companies
- Partnerships
- Offshore companies
- Sole traders
- LLPs (Limited Liability Partnerships)
Other factors that can influence eligibility include:
- Your business’s trading experience
- The industry in which your business operates
- The type of property you wish to mortgage
- The location of the property
Alternatives to Commercial Mortgages
If your needs are urgent or if you require flexibility in your funding options, there are alternatives to a commercial mortgage. One such option is a bridging loan, which provides rapid access to capital for property purchases. This loan can be followed by a transition to a commercial mortgage once the sale is finalized, offering both speed and flexibility in your financing strategy.
Getting Your Paperwork Ready
Generally, lenders will require the following documents, although your advisor will guide you on the specific requirements based on your chosen lender:
- The last three years’ financial accounts (or tax returns).
- Current and projected performance figures.
- Recent bank statements.
- Details of directors and significant shareholders.
- Information on company structure, including any group or subsidiary holdings.
- Personal asset and liability statements.
- Details of tenants or lease agreements (for commercial investment mortgages).
Let i10 Networks Help You Secure the Right Commercial Mortgage
Our commercial mortgage brokers specialize in finding the most competitive lending solutions for a range of commercial property needs. Whether you’re purchasing your first investment property, refinancing an existing one, or expanding your portfolio, we’re here to help.
Contact us today to discuss your requirements and take the first step toward securing the ideal commercial mortgage for your business.
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