Unlocking Opportunities: Your Guide to Commercial Mortgages

Welcome to Acorn.finance, where we transform commercial properties from liabilities into valuable assets. Discover the key to your business’s success through our commercial mortgage (business mortgage) solutions. Whether you’re looking to purchase, refinance, or unlock capital, we’ve got you covered.

What is a Commercial or Business Mortgage?

A commercial mortgage is not just a loan; it’s an investment in the foundation of your business. Secured against your business premises, a business mortgage will empower your growth, giving your business the freedom to grow and to adapt the premises to fit your needs! Oh – and no more rent payments!

Why Choose Acorn.finance?

With a legacy dating back to 1997, we’ve earned our stripes in arranging funding. Seven UK Best Broker Awards and a 5-star customer feedback record speak volumes about our commitment to excellence. Trust us for your business mortgage needs and experience financial solutions that stand the test of time. Find out more about Acorn.finance here. We’re working with almost every business mortgage lender in the market to ensure that Acorn.finance clients get the right commercial mortgage.

What Can You Use a Commercial Mortgage For?

The possibilities are vast when it comes to utilising a commercial mortgage:

Buying a Trading Business: – Dive into ventures such as retail, hospitality, pubs, or the care sector. In some sectors the business mortgage lender will assess the acquisition based on the going concern value of the business rather than only the property, thus allowing a better commercial mortgage rate to be negotiated and a potentially higher loan to value.
Purchasing Business Premises: Secure locations for operations, whether it’s a storefront, warehouse, or manufacturing space.
Refinancing Existing Debts: Consolidate, reduce interest rates, or reschedule repayments to achieve financial stability – commercial mortgage rates are lower than those for unsecured debt or credit cards and business mortgage lenders have a longer repayment profile helping to reduce your monthly business outgoings.
Financing Refurbishments: Breathe new life into your space or acquire additional assets and properties. Doing so can maximise your business profitability.

Alternatives to a Commercial Mortgage

While a commercial mortgage is often the optimal choice, we understand that circumstances vary. Explore alternatives like bridging loans or business loans if a traditional mortgage isn’t currently viable.

Our specialists are here to guide you toward the most suitable solution.

How to Get a Commercial Mortgage

The process is straightforward:

Who is the Applicant?

Understand the identity and credibility of the borrower.

What Are the Funds For?

Clearly articulate the purpose of the funds.

How Will the Funds Be Repaid?

Demonstrate a viable plan for repayment.

Different lenders may have varying criteria, such as business experience or debt servicing cover requirements. Visit our forthcoming guide for more in-depth information on securing a commercial mortgage.

Business Loans: A Flexible, Unsecured Alternative

Consider a business loan for increased flexibility, especially if the stringent requirements of a mortgage pose challenges. While repayments are typically higher, the shorter term can make this option more accessible, especially for non property-related projects.

Our specialists are here to guide you toward the most suitable solution.

Special Cases: Turning “Impossible” Into Reality

At Acorn.finance, we thrive on challenges. So some of our success stories include:

Explore possibilities beyond the conventional, and let us turn your unique case into a success story.

Join the league of business owners who’ve partnered with Acorn.finance for enduring financial success.

Business & Commercial Mortgage FAQs

What is a business mortgage?

A business mortgage, also known as a commercial mortgage, is a loan specifically designed for purchasing or refinancing commercial property for business purposes. It’s similar to a residential mortgage but tailored for commercial properties such as offices, retail spaces, industrial buildings, and warehouses.

What types of properties can be financed with a commercial mortgage?

Business mortgages can be used to finance various types of commercial properties, including office buildings, retail units, industrial warehouses, mixed-use developments, and investment properties. The eligibility criteria may vary depending on the lender and the type of property.

How do commercial mortgages differ from residential mortgages?

Business mortgages typically have different terms and conditions compared to residential mortgages. They often have higher interest rates, shorter loan terms, and stricter eligibility criteria. Additionally, commercial mortgages may require larger down payments and may not offer the same consumer protection regulations as residential mortgages.

What are the benefits of obtaining a mortgage for a business?

Business mortgages offer several benefits, including the ability to purchase or refinance commercial property for business use, potential tax advantages, fixed or variable interest rate options, and the opportunity to build equity in the property over time.

How much can I borrow with a business mortgage?

The amount you can borrow with a business mortgage depends on various factors, including the value of the property, your creditworthiness, your business’s financial health, and the lender’s criteria. Typically, lenders will finance a percentage of the property’s value, known as the loan-to-value (LTV) ratio.

What documentation is required to apply for a business mortgage?

The documentation required for a business mortgage application may vary depending on the lender and the complexity of the transaction. Common documents may include business accounts, property valuations, business plans, and personal financial information of the business owners.

Can I use a business mortgage to purchase an investment property?

Yes, business mortgages can be used to finance investment properties intended for rental income or capital appreciation. However, lenders may have specific requirements and eligibility criteria for investment property financing, including higher down payments and stricter underwriting standards.

What factors affect the commercial mortgage rates of interest?

Several factors can affect the interest rate on your commercial mortgage, including the commercial mortgage lender’s risk assessment, prevailing market conditions, the loan term, the borrower’s creditworthiness, the property’s location and condition, and the overall economic outlook.

Can I use a business mortgage to refinance existing debt or release equity from a property?

Yes, business mortgages can be used for refinancing existing debt secured by commercial property or to release equity from a property for business purposes. Refinancing can help businesses improve cash flow, reduce interest costs, or access capital for expansion or investment.

What are the repayment terms and options for business mortgages?

Repayment terms for business mortgages vary depending on the lender and the specific loan agreement. Common repayment options include fixed-rate or variable-rate loans, capital and interest repayment or interest-only payments. Lenders may offer flexibility in repayment terms to meet the needs of the borrower and the business. Most business mortgage lenders will lend to a maximum term of 25 years but this can reduce for some business sectors and if the term would take business owners beyond retirement age.

Business Mortgage Resources

– CEBR – Economic analysis and comprehensive reports.

– The Institute of Fiscal Studies (IFS): Produces detailed reports on the UK economy, taxation, and business finance, including implications for property investments.

– British Property Federation: Provides resources and advocacy for the UK real estate sector. They offer reports, policy updates, and best practices relevant to commercial property and financing.