Owner occupied commercial mortgages explained
Simply put, owner occupied commercial mortgages are for business owners who are looking to purchase a property from which to run their company.
A lower risk commercial investment
As the decision to approve this type of loan is based not only on the chosen property’s value but also on the firm’s revenue and assets, lenders tend to favour owner occupied commercial mortgages over investment mortgages. It’s also considered to pose less of a risk because the borrower is personally involved in the success of the company.
For owner occupied commercial mortgages, you can expect to be offered a Loan To Value (LTV) of around 70-75%, increasing to 80% depending on the lender and your circumstances. It’s also worth noting interest repayments with this type of mortgage are tax deductible. Be aware that usually, the less experience your company has, the higher the deposit needed. A good mortgage broker will be able to help you by discussing all the applicable costs and options available before you apply.
The benefits of owner occupied mortgages
Whether you want to buy your current offices or secure brand-new premises, owning your own property puts you firmly in control of your business, especially if you choose a fixed rate mortgage (say goodbye to unexpected rent hikes or charges from the dreaded landlord!). What’s more, depending on your agreement with your lender, renting any unused space can be a great way to boost your income and, just like domestic housing, commercial property tends to appreciate over time further adding value to your business.
There are countless lenders of owner-occupied commercial mortgages available. Cut through the noise by engaging the help of a finance professional at FC Funding, one of the UK’s leading brokers. We’ll be able to guide you through the process, explain all the jargon, save you precious time and ultimately, find you the very best deal.