3 Key Features of Commercial Mortgages
Are you looking to buy a property for your business? Learn more about the key features and benefits of commercial mortgages, including their flexibility, tax reliefs and great interest rates.
What are commercial mortgages?
Commercial mortgages are a type of loan that is used to buy property from which to run a business, whether that’s your own company or renting it out to someone else’s organisation. As with standard mortgages, there are any number of different options available on the market and can get quite complicated. To ensure you find the product that’s not only right for your needs, but is affordable too, enlist the help of a professional commercial mortgages broker, such as those at FC Funding.
Better interest rates and tax reliefs
Commercial mortgages typically offer better interest rates than a standard business loan because the property is used as collateral, and so is seen as a lower risk investment. What’s more, the interest on commercial mortgages is tax deductible, so you can make significant savings.
Any business can apply for a commercial mortgage
Lenders offering commercial mortgages don’t take your businesses industry into account, so whether you're looking to buy a farm or a factory, any one can apply for one. However, most lenders will only offer commercial mortgages to those who pass certain checks, including:
- Assessment of the financial ‘health’ of your company (income and debts)
- The projected income of your organisation to ensure you can cover repayments
- The size of your deposit
- If applicable, any rental income
- The usual credit, income and assets assessments
Choose how you want to repay your commercial mortgages
With most commercial mortgages, you can choose to either pay back the capital as well as the interest or only pay back the interest. Both options have advantages and disadvantages, for instance, if you opt for an interest only commercial mortgage, your monthly payments will be lower but by the end of the term you’ll have to find another way to pay back the original amount of the loan. What you decide will depend on your individual circumstances and your broker will be able to advise you further.
FC Funding make finding a great deal on commercial mortgages simple and easy. To learn more about our bespoke commercial mortgages, contact our expert brokers today on 01202 937880 and we’ll be happy to discuss your options.