Commercial Mortgage Finance

Commercial Mortgage Finance

A guide to commercial mortgage finance

What is a commercial mortgage? A commercial mortgage is a loan secured (or guaranteed) using property that is not your residential home. Any proceeds from a commercial mortgage are typically used to buy, refinance or redevelop commercial property.

So, there is a similarity with residential and buy to let mortgages, however, commercial mortgages are not regulated by the Financial Conduct Authority.

We have included some information about financing commercial property, so please read on. Or, contact us to discuss your requirements and find out about current opportunities that are available.

Why you may need commercial mortgage finance

One of the most common needs for a commercial mortgage is your need for business premises. 

For example, a factory, industrial warehouse, shopping complex or office block. 

A commercial mortgage or commercial mortgage finance can also be used to expand an existing business and for residential or commercial property development. 

Commonly, they are the principal resource for financing any business development plan.

Unlike a residential mortgage, a commercial mortgage extends finance in four distinct ways: 

  • Buying business premises 
  • Securing land development ventures 
  • Developing an owner-occupied business 
  • Adding to a buy-to-let portfolio

Lending for commercial mortgages has been rising steadily since 2011, according to figures published by HM Revenue and Customs in 2015. In 2014, commercial mortgages represented just 5.2% of all mortgages advanced, but 25.3% of all mortgages by value. 

The average commercial mortgage was found to be nearly £1.5 million, compared to the average residential mortgage. Which was less than £250,000.

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What types of commercial finance are available?

While the principle of a commercial mortgage is relatively straightforward, it is important to note that any lender will be expected to take a keen interest in the following:

  • The value, nature, and state of repair of the commercial property against which any mortgage is to be advanced.
  • The financial standing, health and prospects for growth of the business seeking the mortgage loan will be a consideration. As this is how the lender will assess the ability of the business to maintain commercial mortgage repayments.
  • There are a wide range of commercial mortgages available. Distinguished mainly by the amount borrowed, the rate of interest attached and the mortgage term. 

Allow us to find you the best deal for your business. 

Contact Brookfield Finance today.

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Why use Brookfield Finance Ltd?

  • At Brookfield Finance, we have considerable experience in helping clients to expand their businesses by accessing the funding that is needed.
  • By considering your unique needs, we will find the business finance solution that is most appropriate for your business and your industry. We will then present you with the most financially attractive options to help you move forward quickly.

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