What is a Business Loan?

In many ways a business loan or commercial mortgage is much like a residential mortgage in that you pledge property as security against a loan to either buy or refinance that property. When you use a commercial mortgage to buy property, or to raise funds for any other business purpose, the lender retains an interest in that property until the loan has been paid in full. Unlike other types of business loans, such as bridging which usually have a relatively short repayment period, you can take out a loan for as long as 30 years if required.

The amount of money that you are able to borrow is generally only restricted by the value of the property you are looking to purchase or refinance, and is calculated on a Loan to Value (LTV) basis. However even if there is not enough equity in the property you are looking to purchase or refinance, you may still raise funds by using your home or other property as additional security. This way you could raise up to 100% of the money you require without the need for a deposit.

Whether you are looking to expand you business with new premises or simply to buy your holiday home in the Bahamas or St. Kitts, a commercial mortgage could bring your dreams to reality.

If you already own your property, then you may be able to obtain a second charge. This is simply a second or subsequent charge that lies behind the first charge. Secured loans can be used for any purpose and are available to virtually anybody resident in the UK.

One of the benefits of a secured loan is that, generally you can obtain more funds than you would be able to with an unsecured loan, with no interruption to your mortgage.