Commercial mortgages – how to obtain «

Commercial mortgages – how to obtain


Obtaining a commercial mortgage is like any other application for business loans or funding – a strong business case and good sales pitch are required. The lender will want to feel confident and reassured that your business is able to cope with the repayment demands that a mortgage requires, and they will therefore want to analyse your company’s financial situation thoroughly. This investigation will probably include:

• the company history, which they’ll determine from looking at your accounts, cash flow and financial statements, both current and past

• your business projections: estimated future cash flow and profit, long-term plans for the business and your intentions for the property that you want to purchase

• your own financial situation: if your company is young or small, the lender may want some form of personal assurance and security, and they may therefore want to investigate your own financial history as well as that of other key players in your company

From this examination, the mortgage provider will calculate the level of potential risk that may be incurred by granting you a mortgage. This level of perceived risk will allow the lender to calculate what rates and terms they are prepared to offer you.

Most small business owners’ first point of call when enquiring about a mortgage for their business is the bank with whom they already have business financial arrangements. Yet, even if you’re on good terms with your bank manager, you’re not likely to get a good mortgage offer from them, as they already have your business.

Independent commercial mortgage brokers can often provide the best and most competitive deals. There are many brokers who specialise solely in commercial mortgages and can investigate hundreds of products on your behalf to make sure you get the deal that best meets your own requirements. Credit history (personal and business) needn’t be an obstacle either. Think of the broker as your representative – they’re the professional expert and will do the sales pitch for your business on your behalf. They know the market and the hundreds of different mortgage providers as well as understanding your needs, so they are in the best position to get a good all-round deal. You may even be in the position to negotiate the best terms for you, especially if you receive a number of offers from a range of lenders.

The savings you’ll enjoy from using an independent commercial mortgage broker aren’t just financial. Think of all the time, effort and hassle you’ll save yourself from having to investigate the market, understand lenders’ requirements, make applications and negotiate terms. Instead, leave it all to the expert whose independent advice will get the best deal there is for you.

 

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