Commercial mortgages for limited companies.
Buying premises to trade from, or as an investment. Shops to warehouses, owner-occupier to portfolio, from 6.24% a year and arranged across the whole market.
What is a commercial mortgage?
A commercial mortgage is a loan secured on property used for business: a shop, office, warehouse, industrial unit, pub, surgery, or a mixed-use building. It is secured on commercial premises rather than on someone's home.
In principle it works like a residential mortgage. You borrow against the property, secured, and repay over a term. In practice it is underwritten very differently, because the lender is assessing a business and a commercial asset, not a household and a home.
We arrange them for limited companies, SPVs and trading businesses. Commercial property is inherently a business purchase, so this is squarely our market rather than an exception to it.
Owner-occupier or investment?
This is the question that changes the whole application, and the one borrowers new to commercial do not know to ask.
Owner-occupier
Your business buys premises to trade from: a shop for your retail business, a unit for your workshop, an office for your firm. The lender assesses your business's ability to afford it, through its accounts, trading history and projections. The property and the business are the same story.
Commercial investment
You buy commercial property to let to a tenant, for the rental income and the capital growth. The lender assesses the tenant, the lease and the rental income, much more like a buy-to-let. Your covenant matters, but so does the tenant's.
Which one you are determines the lender, the criteria, the deposit and the rate. A lender that is strong on owner-occupied trading premises may have no appetite at all for investment, and the reverse is just as true. Getting matched to the right one is most of the job.
Commercial vs residential mortgages.
The differences that catch people moving across from residential lending.
- Bigger deposits. Commercial mortgages typically need more deposit than residential, often 25 to 40 per cent, because lenders see more risk in commercial property.
- Shorter terms, often. Commercial terms are frequently shorter than the 25 to 35 years common in residential.
- Rates are priced individually. There is rarely a best-buy table. Commercial rates are quoted deal by deal, on the property, the business and the covenant.
- Underwriting is about the business. Residential is about your income and credit file. Commercial is about the trading business, if you occupy it, or the tenant and lease, if you let it.
- Valuations are more involved, and often on a different basis: vacant possession against investment value. That difference alone can swing how much you can borrow.
- Fewer lenders, less transparency. The commercial market is smaller and quieter than residential, and much of the appetite is never published. That is precisely where a broker earns their keep.
How much deposit do you need?
Typically 25 to 40 per cent, so a loan to value of around 60 to 75 per cent. It varies more than residential does.
- Property type. Standard shops and offices attract better loan to values than specialist assets such as pubs and care homes, which lenders see as harder to resell.
- Owner-occupier or investment. Owner-occupied trading premises can sometimes achieve a higher loan to value than an equivalent investment purchase.
- The business. A strong trading history supports more borrowing, and weak or short accounts reduce it.
- Additional security. Some deals gear higher by taking a charge over another property.
A route people miss: you can sometimes reduce the cash deposit by offering additional security, or by bridging to buy and refinancing onto a commercial mortgage once the business is established in the premises. Commercial bridging →
How commercial mortgages are priced.
Commercial rates start from 6.24% a year. Beyond that there is no rate table, because there is no standard product.
Where your deal actually prices is built from:
- The property type and how easily it would resell
- Owner-occupier or investment
- The business's trading strength, or the tenant's covenant
- Loan to value
- Term
- Your experience and track record
A commercial rate quoted without seeing the deal is close to meaningless, so beyond the headline we will give you a real indication for your specific property and business rather than a website teaser. Model the numbers → · See indicative rates →
Semi-commercial and mixed-use.
A large slice of commercial property is mixed-use: retail below with flats above, an office with a residential element, a pub with living accommodation over it.
These are their own specialism, because lenders split on how they treat the residential portion. The mix decides whether the building is underwritten as commercial, as residential investment, or as a blend of the two, and that decision changes the lender, the loan to value and the rate.
Get the split wrong at application and you can be declined by a lender who would have said yes to the same building presented correctly. It is one of the more common reasons a straightforward mixed-use purchase stalls.
Different assets, different lenders.
Appetite varies sharply by what the building is and what happens inside it.
Shops and retail units
The classic high-street commercial mortgage, owner-occupied or let.
Offices
Including conversions and buildings with a residential element.
Warehouses and industrial
Often the strongest loan to values in commercial, because the assets resell readily.
Hotels
Trading businesses as much as buildings, and valued on the income they produce.
Pubs, restaurants and leisure
Trading assets on a specialist lender panel, usually needing more deposit.
Care homes
Specialist and regulated, with a narrow panel and close scrutiny of the operator.
Why use a commercial mortgage broker.
Commercial lending is where appetite is least visible and varies most. There is no comparison table because there is no standard product.
- Match the property and business to real appetite. Lender appetite in commercial shifts and is mostly unpublished. Knowing who is actually lending on your asset this month is the difference between a yes and a month wasted.
- Present the accounts or the tenancy the way a credit team reads them. The same business can look marginal or solid depending on how it is set out.
- Structure owner-occupier against investment correctly from the start. Getting this wrong is the most common reason a good commercial deal goes to the wrong lender.
- Push back on valuations where the basis is arguable, because vacant possession against investment value can move the loan materially.
- Cost the whole deal, not the headline rate: arrangement fee, valuation, legals and any early repayment terms.
We also deal with commercial property ourselves, buying, converting and regenerating it as part of our development work. We understand these assets as an owner, not only as a broker. See what we have built → · Meet the team →
Building rather than buying? Development finance →
We are independent, and we work with limited companies and SPVs only.
Tell us the property, we will tell you where it prices.
- Call0333 577 1988
- Emailinfo@huntergrey.co.uk
- WhatsApp07977 486886
Need to move fast? Commercial bridging → · Model it: calculator →
Commercial mortgages, answered.
What is a commercial mortgage?
A loan secured on property used for business, such as shops, offices, industrial units and mixed-use buildings, rather than on a home. It is underwritten on the trading business or the tenant, not on a household income.
How much deposit do I need for a commercial mortgage?
Typically 25 to 40 per cent, so a loan to value of around 60 to 75 per cent. It varies with the property type, whether the property is owner-occupied or an investment, and the strength of the business. Specialist assets usually need more.
What is the difference between a commercial and a residential mortgage?
Commercial mortgages need bigger deposits, often run shorter terms, are priced individually rather than from a best-buy table, and are underwritten on the business or tenant rather than personal income. There are fewer lenders and far less published pricing.
What is the difference between owner-occupier and commercial investment mortgages?
An owner-occupier mortgage funds premises your business trades from and is assessed on your business's affordability. An investment mortgage funds property you let to a tenant and is assessed on the tenant, the lease and the rental income.
What are commercial mortgage rates?
Commercial rates start from around 6.24% a year and are then priced individually, deal by deal. There is no best-buy table: pricing depends on the property, the business or tenant, loan to value, term and experience. Calculator →
Can I get a mortgage on a mixed-use property?
Yes. Semi-commercial and mixed-use property is a specialism, because lenders treat the residential and commercial portions differently and the mix decides how the whole building is underwritten.
Can I get a commercial mortgage as a first-time commercial buyer?
Yes, though the lender panel is narrower and pricing is usually higher without a track record in commercial property. A strong trading business or a strong tenant covenant matters more than previous commercial ownership.
Do you work with individuals?
No. We arrange commercial mortgages for limited companies, SPVs and trading businesses only.