What are the benefits of using a broker?
The contacts and commercial knowledge for the best deal. They present your case to the lender on your behalf.
Brokers that are NACFB (National Association of Commercial Finance Brokers) members can be relied upon to have Professional Indemnity insurance and to abide by a Code of Practice.
Whilst it is beneficial to do your own price comparisons, applying for finance at multiple lenders may affect your credit rating if you are not accepted.
Lenders generally require a deposit of around 25% - 40% of the total value and mortgage terms can run for 1 year up to 40 years.
Obtaining a commercial mortgage is based on the ability of your business to be able to repay the loan.
Lenders will assess this ability of repayment before issuing a quotation for the interest rate.
Typical documentation you may be asked to provide would be financial accounts for 3 years, bank statements and business projections.
You may need to provide a detailed business plan which will demonstrate that the repayments can be met.
Past and current performance along with future plans of the business will be looked at.
The interest rate quoted may be based on these factors and, as a result, may be higher if a high risk is identified.
Often lenders will take the property being purchased as the security of the loan (typically 75%) along with a deposit for the balance of the purchase price.
If a deposit is unavailable, additional security could be offered in the form of other property with e equity in it and we are able to take security as a second charge behind your existing lending provider
Commercial Mortgage Guide
- What is a commercial mortgage?
- When are commercial mortgages applicable?
- Who can apply for a commercial mortgage?
- What is the Funding for Lending Scheme?
- Where can I find the best deals?
- Can I mortgage leasehold and freehold properties?
- What are typical arrangement fees?
- What other fees might I incur?
- What are the benefits of using a broker?
- What is the typical loan to value ratio (LTV)?
- Why can't I find a table of rates?
- Which properties qualify as commercial?
I just wanted you to know that the experience with Charelston has been utterly professional and competent in every aspect of this transaction. The solicitor I instructed was not good at all and I would have walked away from this deal a long time ago had Andrew not consistently calmed me down and gone the extra mile to find solutions to any stumbling blocks that came up. I have been particularly impressed by his balance of never pestering but always remaining attentive and responsive when required. I was a director of a FTSE financial services firm for 12 year so know about the importance of customer service and the thing I notice most in the industry is how rare decent service actually is. Well done to you on employing, training and motivating staff of Andrew’s calibre, I would certainly use you again in the future.