Commercial Mortgages

With a Commercial Mortgage you can either purchase the building your business is in or buy property for investment purposes. We search through both High Street banks and private lenders to find you the best deal for your circumstances.

WHAT IS REQUIRED

A Clear Purpose & Property Details

Deposit / Equity Contribution

Financials & Affordability Evidence

Tenancy information (for investment purchases)

WHY CHOOSE IT?

Build Long-Term Stability

Free Up Cashflow - it may be more affordable than renting

Grow Your Business or Portfolio

Flexible Repayments and Longer Terms

What is a Commercial Mortgage?

A Commercial Mortgage is a long-term loan secured against commercial property. It's designed to help businesses either purchase premises to trade from (owner-occupier) or invest in commercial property to generate rental income (investment).

Whether you're buying your first premises, refinancing an existing loan, or expanding your portfolio, we work with a wide panel of lenders to match you with the most suitable terms.

We also offer tailored solutions for professionals looking to buy premises for their own practice. If that's you, take a look at our Professional Practice Loans page for more specific guidance.

How does it work?

Depending on the type of property and the sector you're in, lenders may offer up to 85% loan-to-value on a commercial mortgage. Terms typically range from 5 to 25 years, with monthly repayments. You'll usually have the choice between capital repayment or interest-only, depending on the purpose of the loan and the strength of your application.

Once initial affordability checks are complete and a Decision in Principle has been issued, the next step is to instruct a property valuation.
If the valuation supports both the purchase price and any rental income assumptions, solicitors will then be instructed to progress the legal work.

It's important to note that the borrower is typically responsible for the cost of the valuation, as well as both their own and the lender's legal fees.

Commercial property purchases also benefit from reduced Stamp Duty Land Tax (SDLT) rates compared to residential transactions. To calculate what you might pay, use the SDLT calculator on the Gov.uk website.

Is a Commercial Mortgage suitable for me?

Whether you're a business owner looking to purchase a premises to trade from, or an investor acquiring non-residential property to rent out, a commercial mortgage is likely the right funding solution for you.

Owner-Occupiers:

If you run a business and want to buy your own premises—such as an office, warehouse, retail unit, or industrial space—a commercial mortgage can be a smart alternative to renting. Owning your property gives you greater long-term security, the opportunity to build equity, and often reduces monthly overheads.

Property Investors:

If you're purchasing commercial property as an investment to let out to other businesses, a commercial investment mortgage gives you the leverage to grow your portfolio. This could include high street shops, office blocks, industrial estates, or mixed-use developments.

Commercial mortgages are also commonly used to refinance existing borrowing, release equity for growth, or facilitate partner buyouts.

What is required for an application?

The documents and information you'll need may vary slightly between owner-occupier and investment cases, but typically include:

Business accounts and income evidence for the past 2–3 years (personal tax returns)
6 months business and personal bank statements
Details of the property being purchased or refinanced
Detailed information on the trading business
Tenancy information (for investment purchases)
Asset and liability statement for applicants

FAQs

How much can I borrow?

Typically up to 85% of the property’s value, however this varies depending on affordability, property type and industry. Most lenders will max out at 75% loan to value.

Is there any chance to get a 100% LTV Commercial Mortgage?

A 100% LTV is possible but we would need you to offer some additional security (i.e. another property), or own a professional practice.

Can I still get a Commercial Mortgage if I have adverse credit?

Yes, though if it is very severe then probably not.

Can I get funding for a HMO (House of Multiple Occupancy)?

Yes, we have many lenders prepared to lend to HMOs.

Can I borrow to buy a Leasehold (not Freehold) premises?

Yes but there needs to be a long lease on the property, typically in excess of 50 years. You should also check the clauses in the lease, such as increasing ground rent as this could affect your ability to borrow.

What types of properties can be purchased with a Commercial Mortgage?

Anything with a commercial element, including offices, warehouses, industrial units, retail premises, mixed-use buildings, care homes. Semi-commercial properties such as shops with flats above also qualify, as well as large HMOs and blocks of flats.

Can I get a Commercial Mortgage if I’m self-employed?

Yes. Many lenders are happy to support self-employed applicants as long as you can demonstrate sustainable income and a good track record.

What are the fees to get a Commercial Mortgage?

If you decide to use us to arrange your mortgage there is no fee to get a quote but you will be charged you 1% of the loan amount (minimum £999) if you proceed with the application and get a formal loan offer. It is also normal that you pay the lender’s legal as well as valuation fees and there may also be an arrangement fee from the lender. However, lenders do deals from time to time where some or all of these expenses are removed so we monitor these options and can advise you where the best deal is.

Why should I use a Commercial Mortgage broker?

You can do all this yourself, of course, but we can a) save you time by knowing which lender will give you the best deal; b) avoid complications later in the deal by presenting the information to that lender in the manner that makes them most likely to lend; and c) we can guide you through the process and make sure you compete the finance as efficiently as possible.

What's the difference between owner-occupier and investment commercial mortgages?

Owner-occupier mortgages are for premises your own business will trade from. Investment mortgages are for buying property you plan to let to third-party businesses.

Can I use a Commercial Mortgage to refinance an existing property?

Absolutely. Many clients refinance to access better rates, raise capital for growth, or release equity tied up in property.

Do I need to be VAT registered?

Not always. However, some commercial properties are VAT-elected, so VAT might apply on the purchase price. If VAT will be payable, then a VAT loan may be appropriate in addition to a commercial mortgage.

How long does the process take?

Typically 8-16 weeks from initial application to drawdown, depending on how quickly the valuation, legal work, and due diligence can be completed. It is possible to complete a transaction in as little at 4-8 weeks if it is a refinance.

I've already had a valuation done on my property; do I need another one?

In some cases, lenders may accept a reissued valuation report if it was conducted recently. However, not all lenders will accept this, so your options may be limited depending on the timing and the lender’s requirements.

Can I purchase a property in a new limited company?

Yes, it’s possible to purchase a property through a newly formed limited company and is known as an opco/propco structure. Many business owners choose this route for tax benefits and asset protection.

I am a first time investor, can I get a commercial investment mortgage?

Yes, it’s possible to secure a commercial investment mortgage as a first-time investor. However, lenders may have stricter criteria for first-time buyers, as they’ll assess factors like your experience, financial stability, and the potential income from the property. While many lenders prefer applicants with previous property investment experience, we work with a range of lenders who can support first-time investors, often with a higher deposit. Having some evidence of running a successful business and/or property investing experience will help to support your application. If you're new to commercial property investing, we can guide you through the process and help you access the best possible financing options.

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Choice Loans is a broker, not a lender. We will connect you with a lender suitable for your needs or, if appropriate, a specialist broker. We do not charge you an upfront fee but, if your application is successful, a broker commission may be charged.