Mortgages for Semi-Commercial Properties
Semi-commercial mortgages are offered for people who are looking to purchase a property which has both domestic and industrial aspects. Property including blended use would normally be bars with a self-contained residential living location, flats above shops, visitor homes with owners lodging, HMO’s with a retail device and holiday parks with domestic lodging.
Semi commercial mortgages are available for both freehold and lease hold property. Generally lenders will lend up to 65-70% with a maximum of 75% of the purchase price or value, nonetheless if the candidate has equity in other properties some lenders will consider this as additional security and might potentially lend up to 100%.
Do you require a semi-commercial mortgage?
A semi-commercial mortgage is made for properties where there is a company unit and a residential home in the same building. This can include, for instance, a shop with a flat above it or a domestic home where part of it has actually been transformed into a business, for example a bar or a guesthouse.
It does not make any distinction what percentage of the property is residential or commercial, even if 70 per cent of the building was residential then a commercial mortgage would still be needed.
- A semi-commercial mortgage is required because 2 kinds of mortgage, residential and industrial, are integrated and required to fund the purchase of the building.
- Semi-commercial mortgages are dealt with like commercial mortgages and so it is commercial mortgage lenders who would fund your purchase.
- The only exception to this is if the property has a totally different entryway, so there is no need to utilize the commercial aspect of the property to access the property, then it may be possible to obtain 2 separate mortgages.
Semi-commercial mortgage LTV
Usually it is possible to borrow between 65-75 per cent of the purchase value, without any extra security. The lending requirements will resemble an industrial mortgage and so will take account of any accounts, profits or provider criteria.
It is, in some cases, possible to acquire a loan for 100 per cent of the value with added security, as an example if you own another property. This can be helpful if you have an effective office and are seeking to expand.
100 per cent semi-commercial mortgages are also available for individuals who are existing renters in the property and who are planning to buy their existing office premises. This means that, if you have built a business in a property but have not had the ability to save a deposit, you can remain trading with no interruption. You can also start to take pleasure in the advantages of ownership, such as seeing an investment for your monthly payments.
Mortgages are available to sole traders, limited companies and partnerships. This means that there is no reason for any kind of business to have to remain in a leased property if they want to own their building.
Alternatives available for semi-commercial mortgages
Both financial investment and owner-occupier mortgages are available. This means that if you are wanting to buy a property to lease then a semi-commercial mortgage is offered to fund it. Also if you are looking for lending in order to get properties to work from then this is an option.
It is possible to benefit from interest-only periods, for the complete duration of the mortgage in some circumstances. This can often make the month-to-month payment lower, which is particularly helpful if you have simply set up a business or moved into a larger unit.
- There is also the choice to have capital and interest repayment options, meaning that you can customize your repayments to fit your situation.
- There is the option to have fixed rate repayment options, which can help ease the budgeting as well as for doing business accounts.
- The payment time can be spread over a period convenient to you, this could vary from three to thirty years, which offers you terrific versatility in managing your mortgage.
The benefits of using an experienced commercial mortgage broker
As with any monetary decision it is sensible to look around prior to signing any documentation. The range of options available can be many and are challenging to sift through particularly as you are also running, or starting, a local small business.
Using a knowledgeable commercial mortgage advisors such as The Mortgage Hut to locate the most appropriate commercial mortgage finance offers can save you the time and hassle of exploring the alternatives yourself, and as they are “whole of market” brokers, you get the comfort knowing that every possibility has been looked at to guarantee we find the right mortgage for you.
Making use of The Mortgage Hut will save you the time it takes completing applications, because we can complete all the documentation on your behalf, providing you with the best choices that you can then pick from.
Our fully-trained consultants pride themselves on giving independent, unbiased guidance and we offer a no obligation quote free of charge. Making the most of this offer means that we can recommend you on the best semi commercial finance deals without any commitment from you to proceed.
The Financial Conduct Authority does not manage some kinds of Commercial Mortgages.