Commercial Mortgages
The main difference in the things that affect commercial mortgages from residential mortgages is that your ability to repay the loan becomes dependent on the performance of the business.
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General Considerations for commercial mortgages
Credit Ratings
Lenders will view your credit standing in much the same way as they would for a residential mortgage but, as the number of lenders is somewhat limited, there will be less scope for manoeuvre and a poor credit history is more likely to result in their refusal to lend.
Information requirements
Unlike residential mortgage considerations, businesses are diverse in nature and therefore have to be looked at as individual cases with their own unique requirements. The following is intended to highlight the main things that may be required by a lender and you should ensure you have these things available prior to submitting an application for a loan.
- Business Plan
- 3 Years accounts, if a going concern
- Accountants reference
- Deposit funds, usually 25% of the asset value
A new venture has no track record therefore a lender will look at its assets, your ability to manage it and the quality of the business plan.
If you are purchasing a going concern, then the lender will consider the track record of the business as well as your experience and ability to operate the business successfully.
If the loan is to expand your business, then it's an easier matter as both you and the business will have a track record that can be used to determine risk associated with the success of the business.
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None of the information on this website is intended to promote any specific mortgage product or provide mortgage advice.
CharltonOnLine.com is a trading name of Charlton Marketing and Development Ltd.
CharltonOnLine.com is a trading name of Charlton Marketing and Development Ltd.
Your home may be re-possessed if you do not keep up repayments on your mortgage.
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