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Commercial Mortgage or Loan
A commercial mortgage is probably the best way to finance the purchase of land and/or buildings for your business. A Commercial Mortgage is a specialised commercial loan that will provide a very flexible and affordable financing solution for your business needs. Before taking out a Commercial Loan or Mortgage you may wish to consult your accountant and/or Tax advisers.
How It Works
Similar to Residential Mortgages, the three most important aspects to consider are the interest rate, Interest type and the term for the mortgage.
Advantages of a Commercial Mortgage
· Will not need to raise funds by selling interest in an existing property to an outside investor.
· Your property should appreciate in value.
· A Commercial Mortgage may aid your cash flow.
· Tax advantage. Interest payments on your mortgage are tax deductible and are made with pre-tax money. In contrast purchases made from the proceeds of profit, are, made with after-tax money.
· Potential to Sub-Let.
Disadvantages of a Commercial Mortgage
· Requires you to pledge the purchased property to the lender. If you default on the mortgage Defaults.
· Failure to make any payment on time could result in bankruptcy
Frequently Asked Questions (FAQs)
· Should I purchase property instead of letting?
· What is the usual length of a mortgage?
· How much cash do I need for a deposit?
· How should the mortgage be structured?
· How can I improve my chances of getting a mortgage?
· Who is responsible for the repayment of the mortgage?
Commercial Mortgages are not currently regulated by the Financial Conduct Authority.