Rangewell

5 reasons to grow your business with a Commercial Mortgage

By David Harrison
Content writer
Last update: 17 August 20191 minute read
5 reasons to grow your business with a Commercial Mortgage

Table of Contents

Pulling together your finances in order to purchase property can be a risky strategy for your business. It’s also unnecessary considering that are so many Property Finance solutions available, including Commercial Mortgages. Indeed, a Commercial Mortgage can be a useful tool for your business to take full advantage of, and for good reason. Whether you’re already a property owner or are seeking to give your business a footing on the property ladder, Commercial Mortgages can help spread out the total costs involved, easing the pressure on your finances. So if you have a commercial property purchase in mind that you’d like press ahead with, here are just some of the reasons for why you might consider applying for a Commercial Mortgage:

  • Applicable for a number of property based projects
  • Large lump sums
  • Longer terms
  • Interest may be tax deductible
  • Potential to rent out surplus space

What can I use a Commercial Mortgage for?

Commercial Mortgages can be used for a wide range of purposes in regards to property. As well as supporting the purchase of real estate, Commercial Mortgages can also benefit the properties that you already own by granting you the ability to afford renovations, carry out refurbishments or release equity. Plus, Commercial Mortgages can work with any type of property, regardless of whether they are offices, industrial sites, buy-to-lets, flats or warehouses. So no matter the property or what you aim to achieve, applying for a Commercial Mortgage could help make it happen.

Looking to purchase valuable real estate? Or, do you desire to make improvements to the property’s that you already own? Apply for a Commercial Mortgage today, or find out more about how your business could benefit!

How much can I borrow?

Commercial Mortgage agreements typically start from £50,000 with no set limit to what could be acquired. This is because funding is dependant on the purpose of the agreement and the property in question. If your goal is to make a purchase it will be based on the property’s asking price. But if you already own the concerned property then the funds you could borrow will instead be based on the equity it contains. However, another aspect to consider is how much of the property’s cost or equity you’re able to put forward yourself? Although you’re required to set down at least 20%, offering up to 40% could earn you a lower interest and reduce the amount that you need to borrow, saving your business money in the long run.

How long can I borrow the funds for?

Commercial Mortgages are long-term property finance solutions that offer terms lasting anywhere from 3 to 25 years, and possibly longer. The benefit of having such a long term is that it enables you to spread out the total cost of the purchase or project into smaller monthly payments over time. Although having a finance agreement in place for such a long period could be a daunting prospect, this is much more manageable than parting with the necessary sums in one go and harming your business’ finances. If you’re able, you can repay a Commercial Mortgage early, but you may well be charged a fee for doing so (Redemption Penalty).

Do Commercial Mortgages offer any tax benefits?

Another reason you may choose to apply for a Commercial Mortgage could be because of the potential tax benefits it may offer. The interest that comes attached to each monthly repayment is sometimes considered as tax deductible and could be reclaimed on a quarterly basis, reducing your business’ overheads. However, as with any tax query, make sure that you consult your accountant in order to gain a clearer understanding of where your business stands on this matter.

Are there any restrictions on how I can use the property?

If your lender agrees, you can also rent out or sublet any space that you aren’t using in the concerned property. The benefit of this is that it enables you to generate an additional income that can help support the monthly repayments, and possibly earn a profit. However, you will be responsible for all matters involving the property’s maintenance, including repairing damage, setting up security and establishing an appropriate insurance policy. Also note that if the property loses its value for any reason, this may result in a capital loss as a result.

Thinking about a Commercial Mortgage?

If you’re looking to expand your portfolio or improve the conditions of the properties you own in order to expand your business’ reach and attract more customers, why not explore what applying for a Commercial Mortgage could offer? Applicable for a wide range of real estate, it enables you to spread out the costs involved in purchasing or redeveloping property, enabling you to pursue your goals without putting your business’ finances on the line. So if you aim to buy another property or make improvements to your portfolio, apply for a Commercial Mortgage today, or find out more with Rangewell.

You may be interested in...

Airspace - making money out of thin air

Airspace - making money out of thin air

The space above existing buildings could be a goldmine for developers thanks to some changes to planning laws. We look a...

30 April 2021
VAT lending and commercial property investment

VAT lending and commercial property investment

Your clients who are involved in property investment may have been hard hit recently. Residential Property Investment &...

3 October 2019
How to Buy, Fund and Open a Pub

How to Buy, Fund and Open a Pub

The UK’s pub industry is a turbulent one, offering near-constant fluctuations in profitability and longevity. Desp...

27 July 2023
Reacquiring LPA Receiver Property For Sale With Finance

Reacquiring LPA Receiver Property For Sale With Finance

LPA receivers must sell seized assets and property in as efficient a time-frame as possible to recoup a creditor's c...

4 July 2023

Our service is:

Impartial

Transparent and independent, treating all lenders equally, finding the best deals.

In-depth

Every type of finance for every type of business from the entire market - over 300 lenders.

Personal

Specialist Finance Experts support you every step of the way.

Free

We make no charge of any kind when we help you find the loan you need.