Semi-commercial mortgages are available for people who want to buy a property which has both residential and commercial elements. Property consisting of mixed use would typically be pubs with a self-contained residential living area, flats above shops, guest houses with owners accommodation, HMO’s with a retail unit and holiday parks with residential accommodation.
Semi commercial mortgages are available for both freehold and lease hold properties. Generally lenders will lend up to 65-70% with a maximum of 75% of the purchase price or value, however if the applicant has equity in other property(s) some lenders will consider this as additional security and may potentially lend up to 100%.
Do you need a semi-commercial mortgage?
A semi-commercial mortgage is designed for properties where there is a business unit and a residential dwelling in the same building. This could include, for instance, a shop with a flat above it or a residential dwelling where some of it has been converted into a business, for example a pub or a guesthouse.
It does not make any difference what percentage of the property is residential or commercial, even if 70 per cent of the building was residential then a commercial mortgage would still be required.
- A semi-commercial mortgage is required because two types of mortgage, residential and commercial, are combined and required to finance the purchase of the building.
- Semi commercial mortgages are treated like commercial mortgages and so it is commercial mortgage lenders who would finance your purchase.
- The only exception to this is if the residence has a completely separate entrance, so there is no need to use the commercial element of the property to access the dwelling, then it may be possible to get two separate mortgages.
Options available for semi-commercial mortgages
Both investment and owner-occupier mortgages are available. This means that if you are looking to buy a property to rent out then a semi-commercial mortgage is available to finance it. Also if you are seeking to lend the funds in order to buy premises to work from then this is also an option.
It is often possible to benefit from interest-only periods, often for the full duration of the loan in some circumstances. This can often make the monthly repayment lower, which is particularly useful if you have just set up a business or moved into a bigger unit.
- There is also the option to have capital and interest repayment options, meaning that you can tailor your repayments to suit your situation.
- There is the option to have fixed repayment options, which can help for ease of budgeting and also for doing company accounts.
- The repayment time can be spread over a period convenient to you, this could range from three to thirty years, which again gives you great flexibility in managing your mortgage.
The advantages of using an experienced commercial mortgage broker
As with any financial commitment it is prudent to shop around before signing any paperwork. The range of options available can be lengthy and complicated to sift through especially as you are also running, or starting up, a business.
Using an experienced commercial mortgage broker such as Ascot Mortgages to find the most suitable commercial mortgage finance deals can save you the time and trouble of searching through the options yourself, and as they are “whole of market” brokers, you get the peace of mind that every possibility has been looked at to ensure we find the very best mortgage for you.
Using Ascot Mortgages will save you all the time it takes filling in application forms, because we can complete all the paperwork on your behalf, presenting you with the best options that you can then choose from.
Our fully-trained advisors pride themselves on giving independent, impartial advice and we offer a no obligation initial quote free of charge. Taking advantage of this offer means that we can advise you on the best semi-commercial mortgages without any commitment from you to proceed.
The Financial Conduct Authority does not regulate some forms of Commercial Mortgages.