However, the lending criterion is a lot different to residential mortgages. The lenders willing to work in this sector are not your normal building societies.



Most people will look to their high street bank for commercial mortgages. The high street banks often have very strict lending criteria and often turn down loans. What most people do not realise is that there are hundreds of commercial brokers and commercial lenders who understand business funding and have much more relaxed criteria.

Normally the maximum amount a lender will give is 85% of the purchase price. This can be increased to 100% or more with additional security.

You can have the mortgage for any period between 1 to 30 years and the type of mortgage can be a repayment or interest only.

There are always special deals just like residential mortgages. You can also choose a fixed or variable rate.

The process is very simple. You first complete a very simple application form (one A4 sheet) this will provide enough information for the lender to give you a 'Decision in Principle'. This is a letter from the lender detailing the terms and rates of the mortgage based on the information you have provided.

Assuming you are happy with the 'Decision in principle' offer you will be asked to complete a formal application. This requires a lot more detail information about the business and the property.

Before the lender makes a formal offer the property/business needs to be valued. If any issues arise from the valuation or formal application then the lender may withdraw from the deal or change the terms offered on the 'Decision in Principle'.

Now the paper work needs to be sorted. This is the job of your solicitor who will handle the whole transaction from this point to completion. In just a few weeks you will be handed the keys to your new business or property.