Best Commercial Mortgage UK

Commercial Mortgage Overview

For the commercial mortgage applicant, experience is vital and proposed developments should be of a size, type and in a geographic area where the applicant has a proven record.

The maximum facility is calculated by reference to:

1. The projected sustainable long term income streams
2. Projected medium term interest rates
3. Total development costs and market value of the development on practical completion.

The total amount of the proposed loan must be 60% or less of the projected value once complete. A 40% contribution is required towards land and construction costs to be used at the outset. On some occasions if the land is already owned unencumbered this can be looked as quasi contribution to the construction costs. Development loans would incorporate all costs, including professional fees and finance costs.

Repayment terms usually depend upon planning status, project size and phasing arrangements. Usually, full repayment is expected before 75% of the units are sold.

Documents Required

1. Overview of site location and desirability from the clients perspective.
2. Detailed breakdown of costing's, including site acquisition, ground works, development, professional, finance, marketing costs - Fixed Price Contracts are preferred.
3. Copy of Planning Permission.
4. Build Plan.

*This guide is for information purposes only. You should seek professional advice on your commercial mortgage requirement from a commercial mortgage broker that holds a consumer credit licence.