A break down of Commercial Property Finance

There are many different routes to consider when thinking about commercial property finance. Are you a developer looking to start a new project? Have you bought a property at auction and need to quickly pay for it? Do you need commercial premises for your business?

We’ve decided to break it down into some simple points to help you work out which commercial property product would best suit your needs.

Commercial Property Finance – Commercial Property Finance is a long-term funding option and can be used for 2 main things. Owner Occupied Mortgages is where your business owns the building and trades out of it or a Buy to Let where you purchase a property and let it out to someone else.

Basically, you can use commercial finance to develop, purchase and refinance property and is appropriate for almost everyone to use. If your business is growing and you need bigger premises, owner occupied mortgages can help you get the property you need, whether it’s an office building, warehouse or retail building.  Alternatively, if you are a landlord or thinking of purchasing a property which you intend to rent out a buy to let mortgage would be the best route for you to take.

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Development Finance – Development Finance is a short-term funding option. It can be used for construction projects, new builds, conversions or refurbishment projects. Development finance works by putting together an estimated cost of the land and what it will be worth once the projects have been built, the lender will then agree whether they think that the development is worth the same amount and will then lend the money so that you can complete your project. Once the development is complete and sold you will then pay back the lender the amount borrowed.

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Development finance is perfect for builders who have purchased land and want to build houses that will be then sold on.

Bridging Finance – Bridging loan is a short-term funding option. They are used to ‘bridge’ a gap between a debt coming due – and we’re talking primarily about property transactions here – and the main line of credit becoming available. Or they can simply act as a short-term loan in pressing circumstances. They can be invaluable in helping a property purchase that otherwise would not be possible.

In general, bridging loans are aimed at landlords and amateur property developers, including those purchasing at auction where a mortgage is needed quickly. They may also be offered to wealthy or asset-rich borrowers who want straightforward quick money for business purposes where unsecured lending is not available.

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If you are looking for help and advice on Commercial Property Finance call us on 01274 965356 or email us on info@abl-business.co.uk. We will take a look at your current position and help find a solution that suits your needs.