Commercial Mortgage

Commercial mortgage – a mortgage for your business.

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What is a commercial mortgage?

A commercial mortgage is a mortgage (loan) which is secured on any property which is not your main residence.

For business finance purposes here we’re looking at business mortgages – so commercial mortgages against business premises which are owned and operated by the your business.

So – your commercial mortgage is to purchase or finance the property your business trades from.

If you’ve landed here looking for a buy to let mortgage, commercial buy to let mortgage or other property finance, we have specific property finance pages here.

Learn more about commercial mortgages

Why Acorn.finance

We’ve been arranging funding since 1997 and, if you’ll forgive us for boasting but we think we’re quite good at it!

In fact – 7 x UK Best Broker Awards back us up in that assertion, so does our 5 star customer feedback.

So -for your buy to let mortgage needs, or anything else funding – make sure you use a broker you can trust.

About Acorn.finance

Commercial mortgages

take-away commercial mortgages

What can I use a Commercial Mortgage for?

Whenever you need to buy a building for your business to trade from or release capital from your existing property – A commercial mortgage could be the answer.

Examples of some uses of commercial mortgages are;

  • Buying a trading business (most commonly retail, hospitality, pubs, care sector or small manufacturing)
  • Purchasing premises for your business to trade from (As well as the above could also include service businesses, larger manufacture, warehousing and distribution – in fact any business which needs space to operate.)
  • Refinance of existing debts to release capital or reschedule the repayments (Consolidate other debts, reduce interest rates or regular payments.)
  • Raise finance for a refurbishment or to purchase other assets or property.

In fact – so long as it’s legal you can probably raise funds to do it!

Commercial and semi commercial property finance mortgage buy to let

Alternatives to a Commercial Mortgage

In terms of the interest rate and repayment profile the mortgage is generally the best option for financing property.

Of course there are situations when a business mortgage won’t be available – you can see the general requirements for a successful mortgage application below.

If a Commercial Mortgage is not currently available for some reason then a bridging loan or business loan could be a good alternative, contact our specialists for more help.

shops for commercial investment mortgage

How to get a commercial mortgage

The general requirements for a successful commercial mortgage application are straightforward and similar across all lenders;

  • Who is the applicant?
  • What are the funds for?
  • How will the funds be repaid?

Different lenders will set different height “bars” for each of the three requirements. For instance some lenders might require significant business experience or set a high debt servicing cover requirement (DSCR – profit compared to mortgage payments.)

For more information on how to get a commercial mortgage click here. (Coming soon)

pub mortgage business mortgage

Bridging loans for businesses

There is a variety of circumstances which could make a business mortgage unavailable, these might be around the applicant, the business or around the property.

Bridging finance can be used to meet a number of these areas;

  • Property improvements.
  • Starting up a business in the property.
  • Business development.
  • Short term funding needs for other reasons.
business loan as alternative to commercial mortgage - York shopping street - The Shambles

Business loans

A more flexible alternative to a commercial mortgage, especially a remortgage could be a business loan. The requirements for a business loan might be less stringent, especially around the property.

Because the repayment term of a business loan (especially an unsecured loan) will be much shorter – the repayments will be much higher, even for a smaller amount (Using our commercial mortgage calculator compare a 25 year term to a 5 year term and see the difference in repayments.)

Mortgage Payment Calculator.

£25,000 £10,000,000
5 years30 years
Your repayments are every years at
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