Homeowner loans between £5,000 and £100,000. Click Here If you rent your home, you could still borrow with a personal unsecured loan. Click Here Looking for a mortgage or a remortgage? Enquire about the money you need. Click Here Need a short term loan, fast? Bridge the gap. Click Here Business loans for any purpose. All circumstances considered. Click Here Frequently asked questions about loans and mortgages from FeelGoodLoans.co.uk. Click Here Read All About It! News and articles on loans and mortgages from around the net. Click Here FeelGoodLoans.co.uk aims to help. Need help on your loan or mortgage enquiry?. Click Here
 
 
 
 

Commercial Mortgages In The UK Finance Market

A commercial mortgage is very similar in principle to a residential mortgage or remortgage. The money will be borrowed against the value of the business premises and will most likely be subject to interest over the term of the loan.

In fact, just as with a residential mortgage, the lender will retain an interest in the commercial property until such time as the capital plus interest accrued has been repaid in full. In the event of a default and where no suitable alternative to refinancing can be found, the lender can foreclose on the loan in order to liquidise the asset and realise the amount owed on the outstanding commercial mortgage.

Keeping The Costs Down

So, is there any good news with a commercial mortgage? The simple answer, we're happy to say, is "yes". With a commercial mortgage or remortgage, the interest that accrues is tax deductable and often, even the net proceeds of the loan are not considered by the Revenue to be taxable income. It is always a good idea however, to seek the advice of your accountant beforehand, to ensure that the planned usage of the finance is not for a qualifying business purpose.

Here are some of the more common reasons for taking out a commercial mortgage:-

  • Starting a new business

 

  • Purchasing new commercial premises

 

  • New plant or equipment

 

  • Purchasing new vehicles, or even

 

  • To provide much need working capital

If your planned purpose is anything other than to buy new property, the lender may well ask to refinance your existing commercial mortgage and provide the additional funds you require from the equity in your existing property. The alternative is to offer the finance against the difference between the value of the commercial premises and the outstanding commercial mortgage.

Whatever your purpose, providing commercial finance is a specialist field, populated by a smaller number of lenders compared with residential mortgages. Their help however, can be invaluable for you to achieve your commercial objectives and get you to where you want to go.

In other articles, we'll look at the types of commercial mortgages available in the UK market and how they may apply to your circumstances.

1