Unlike residential and buy to let mortgage finance, commercial finance mortgages are not off-the-shelf products - they are bespoke.
At Bond Finance we spend time on the presentation to the bank to show the case in the best possible light. With our 20 plus year of experience, we understand what the underwriter is looking for, to sign off the case.
The banks appreciate how we work and even refer us their clients when they are unable to agree a case for their own clients.
After submission of a case, the bank will normally offer indicative terms, which state a % margin either over Bank of England base rate or 3 month LIBOR. Higher margins are offered to reflect a higher perceived level of risk. Our aim is to present the case such that the risk perception is as low as possible.
The bank’s indicative offer terms will also state its arrangement fees (typically 1-2%) and the loan structure. The repayment schedule (often referred to as the amortisation rate) is specific to each set of circumstances. For commercial properties, this is usually no longer than the remaining years of the commercial lease and for residential properties the term can be as long as 25 years. We assist our clients in negotiating the most appropriate repayment schedule, possibly incorporating an interest-only period.
The actual term of a commercial loan from most lenders is usually no longer than 5 years, after which the loan needs to be repaid, or renewal terms negotiated
We are able to obtain funding up to 75% of the value of the property, or 100% plus if additional security is offered on a first, second, or third charge basis
Also included under the umbrella of Commercial Finance is:
- Development Finance
- Refurbishment Finance
- Bridging Finance
- Short term loam Finance
Bond Finance has an in-depth knowledge of all of the above