Commercial Finance is a term that covers many different types of finance. It is usually the banks and specialist lenders that provide it and to many it means borrowing against the rental income of the property rather than the bricks and mortar valuation.
It can also mean lending to a limited company and also covers lending to trading businesses or more complex lending.
POINTS TO CONSIDER WHEN COMPARING COMMERCIAL FINANCE
- Manual underwriting;
- Experience essential to get better rates;
- Process can be slower;
- More detailed information required;
- Rent to interest cover higher than traditional BTL;
- All types of tenants considered;
- Term of loan can be shorter;
- Repayment mortgages are the most common.
- Commercial Finance available on an interest only, full repayment or part interest and part repayment basis;
- Loan terms vary from 3-30 years;
- Available to individuals, partnerships, LLPs, trusts and limited companies;
- Minimum property valuation £100,000;
- LTV up to 75%, but typically 70%.