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Re: Commercial mortgage advice needed how much deposit!!!

  •  Tue, Dec 01 2009, 10:04 PM

    Re: Commercial mortgage advice needed how much deposit!!!

    You would need at least a 30% deposit.

    Commercial mortgages are not like residential in that they rarely have set criteria. Every case is looked at on its individual merits.

    What type of business is it, have you done anything like that before, how good is your business plan, what are your cashflow projections for the next 12-18 months, what is your personal background and past history, how will the debt be serviced on a monthly basis

    These are all questions that a commercial lender will want to know the answers to, and that's just the tip of the iceberg. If your answers are not strong, i.e. you have been employed as a plumber for 20 years and know nothing else, but now you want to open an offlicence, your application is likely to be viewed less favourably than the same guy who wants to open a plumbing hardware store.

    Commercial mortgages will tend to be done on a capital and interest basis and for a term that will take you to normal retirement age of 65, or shorter.

    Re: the tenant - a long term lease will not excite the bank in case they need to repossess and evict. They will be happier with a rolling 6-month renewable rental agreement.

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