Commercial property funding for owner occupied premises
Our experience with commercial property funding is mostly in the small to medium sized business space. Often, we are helping clients who wish to purchase the property they are currently leasing, or relocate, so they become owner occupiers and pay back their own mortgage, rather the property owners.
Other scenarios are where a client wants to split their commercial funding away from the bank where they have their own home mortgage, as they wish to ring-fence personal property. Often the home was used as part security at the outset, but the commercial property can now be funded on a stand-alone basis, due to capital gain, debt reduction, or improvements adding value.
Most lenders rely on a first mortgage as security with an amount of 65% to 70% of the property value as a maximum lend. Non Bank lenders are often more flexible on interest-only terms or if you are a start-up business.
Understanding the level of compliance with the current building code is a key issue, as with many older properties, especially those considered historical, the costs of remedial strengthening works, in case of an earthquake, far exceed the future value of the property.
If you wish to purchase or refinance a commercial property and it seems too hard with your bank, just contact us.