Mortgage guide
Commercial Mortgage Guide: detailed guide
A comprehensive commercial mortgage guide covering affordability and eligibility and valuation information for investors and business owners.
- Published
- 13 Apr 2026
- Last reviewed
- 5 Oct 2026
- Reading time
- 7 min
Industrial commercial mortgages
Industrial commercial mortgages are used to fund property such as warehouses, distribution centres, manufacturing facilities, trade counters, and operational industrial units.
Care home mortgages
Care home mortgages are a specialist form of commercial finance used to purchase, refinance, or release capital from residential care homes and nursing homes.
Commercial mortgage for factory
A commercial mortgage for a factory is used to purchase, refinance, or raise capital against manufacturing and production facilities, where lending decisions are driven by a combination of asset risk, operational use, and environmental exposure. Factory lending sits within the industrial sector but is treated more cautiously than standard warehouses or light industrial units due to historical land use and potential contamination risks.
Commercial mortgage calculator
Choose owner occupier for a business buying or refinancing premises it trades from, assessed on adjusted net profit before tax from the latest accounts, or investment for property let to tenants, assessed on lease income.
Farm land mortgage
A farm mortgage is a specialist form of commercial mortgage lending used to purchase, refinance, or raise capital against agricultural property, including working farms, farmland, farmhouses with land, and diversified rural estates.
Mortgage for a pub
A mortgage for a pub is a specialist form of commercial finance used to purchase, refinance, or raise capital against public houses, inns, and licensed hospitality venues. Pub lending is treated as a trading-led sector, meaning lenders assess the property and the operating business together, with affordability driven primarily by trading performance rather than rental value alone.
Commercial mortgage for hotel
A mortgage for a hotel is a specialist form of commercial mortgage used to purchase, refinance, or release capital against hotel and accommodation-led properties, including boutique hotels, independent hotels, and branded or franchise-operated establishments. Hotel lending is treated as trading-led finance, meaning lenders assess the operating performance of the business alongside the underlying property.
Commercial mortgage for offices
A commercial mortgage for offices is used to purchase, refinance, or raise capital against office buildings, business centres, and professional workspace, whether let as an investment or occupied by a trading business. Office lending is assessed on both income security and market liquidity, with lender appetite heavily influenced by location, specification, and demand for the workspace type.
Mortgage for a medical practice
A mortgage for a medical practice is a specialist form of commercial lending used to purchase, refinance, or release capital against premises occupied by healthcare professionals, including GP surgeries, private medical clinics, dental practices, and specialist consulting facilities. Medical practices are generally viewed as low-risk, defensive assets, making them attractive to commercial mortgage lenders when structured correctly.
Dental practice mortgage
A dental practice mortgage is a specialist form of commercial mortgage used to purchase, refinance, or release capital against premises occupied by a dental practice. Dental properties are generally regarded by lenders as low-risk healthcare assets, due to strong demand, stable income, and high professional covenant strength, particularly where income is supported by NHS contracts.
Self storage mortgage
A self-storage business mortgage is a specialist form of commercial mortgage used to purchase, refinance, or raise capital against self-storage facilities, including container storage sites, warehouse-based storage, and purpose-built self-storage centres. While self-storage is an operational business, lenders increasingly view established facilities as attractive, income-resilient assets due to diversified income streams and strong demand.
Retail commercial mortgages
A commercial mortgage for retail property is used to finance property such as high-street shops, neighbourhood retail units, shopping parades, convenience stores, and retail premises with ancillary accommodation. From a lender’s perspective, retail property spans a broad risk spectrum, with lending appetite, leverage, and pricing driven primarily by location quality, tenant profile, and the resilience of the underlying retail model.
Restaurant mortgage
A restaurant mortgage is a specialist form of commercial finance used to purchase, refinance, or raise capital against restaurant premises where the value and affordability are closely linked to the performance of the trading business. Restaurant lending is treated as a trading-led sector, meaning lenders assess both the property and the operational viability of the restaurant as a single risk.
Warehouse mortgages
Warehouse mortgages are a form of commercial finance used to purchase, refinance, or raise capital against warehouse and logistics property, including distribution centres, storage facilities, and fulfilment hubs. Warehouses sit within the wider industrial sector and are generally viewed by lenders as low-to-moderate risk assets, supported by strong occupier demand and broad alternative-use potential.
Equestrian land mortgage
A mortgage for an equestrian property falls outside residential mortgage regulation under MCOB where less than 40% of the land is used as a dwelling by the borrower or their family, so more than 60% is in commercial or business use. In these circumstances, a standard residential or semi-commercial mortgage is not permitted, and the property must be funded using a commercial mortgage.
Commercial mortgage for converted nightclub
A commercial mortgage for a converted nightclub applies where a former nightclub has been repurposed into an alternative commercial, mixed-use, or specialist asset. While the original use may have carried higher risk, lender appetite is primarily driven by the current permitted use, income profile, and marketability of the converted asset, rather than its historic function.
Commercial mortgage for guest house
A commercial mortgage for a guest house is a specialist form of hospitality finance used to purchase, refinance, or release capital against guest houses, bed and breakfast properties (B&Bs), and small accommodation-led businesses. Guest house lending is treated as trading-led commercial finance, meaning lenders assess both the property and the operating business together, with affordability driven primarily by trading performance rather than property value alone.
Mortgage for a business property
A mortgage for a business property is a form of commercial mortgage used to purchase, refinance, or release capital from premises that are occupied or used by a trading business.
Commercial mortgage for a block of flats
A commercial mortgage for a block of flats is used to purchase, refinance, or raise capital against a residential block held under a single freehold or investment title, where the scale, structure, or tenancy profile falls outside standard residential or buy-to-let lending.
Commercial mortgages for pharmacies
Commercial mortgages for pharmacies are a specialist form of healthcare lending used to purchase, refinance, or raise capital against pharmacy premises, including high-street chemists, medical-centre pharmacies, and standalone pharmaceutical outlets. Pharmacies are generally viewed as defensive, low-risk healthcare assets due to stable demand and predictable income, particularly where operations are supported by NHS contracts.
Commercial mortgage criteria
For context, these are the wider product terms covered by this guide. Availability and eligibility depend on your circumstances and the lender.
| Criteria | Detail |
|---|---|
| Max Loan to Value (LTV) | 80% LTV Care Home Mortgages, 100% LTV Medical Commercial Mortgages, 75% Commercial Investment |
| Max Term | Up to 40 years |
| Completions | From 4 weeks |
| Repayment options | Capital repayment and Interest only |
| Commercial mortgage rates | From 6.19% |
| Rate options | Variable, Base Rate Tracker, 2, 3 or 5 year fixed mortgage options |
| Valuation methods | Going concern/Investment (Market value 1, MV1), MV2, MV3 or bricks and mortar |
| Flexible Leases | Rolling leases, weak covenants and short time remaining accepted |
| Adverse credit | Accepted on some products on a case by case basis |
| Locations | Available in England, Scotland, Wales and Northern Ireland |
| Experience | Not required on certain products |
For context, these are the wider product terms covered by this guide. Availability and eligibility depend on your circumstances and the lender.
| Feature | Detail |
|---|---|
| Max Loan to Value (LTV) | 65% |
| Product fee | 5% (4.74% for existing customers) |
| Fixed rate (5 years) | 6.34% |
Related case studies
Frequently asked questions
What is a commercial mortgage?
A commercial mortgage is an asset-backed loan secured against commercial, semi-commercial or large-scale investment property. Lenders assess it on income sustainability and asset risk rather than personal income multiples, and pricing is set case by case, usually as a margin over Bank Rate.
What deposit does a commercial mortgage need?
On the cases we arrange, investment property typically needs a deposit of 25% to 40%. Owner-occupied retail lending can reach 80% loan-to-value, and on medical, dental and pharmacy transactions we currently see a number of options at up to 100% of an MV3 valuation, so no deposit may be needed on the right case. That reflects our experience of the current market, not a standard lender rule.
How much can I borrow on a commercial mortgage?
The lower of two caps. The first is affordability: in our experience investment property needs stressed rental coverage of 125% to 145%, and an owner-occupier's business EBITDA must cover the repayments 1.25 to 2 times. The second is loan-to-value, which in our experience runs at 60% to 75% for most sectors.
Can I get an interest-only commercial mortgage?
Yes, selectively. In our experience interest-only commercial lending typically goes up to 75% loan-to-value, through specialist and challenger lenders, where the income comfortably covers the debt and the exit is credible. High-street lenders generally require capital repayment.
Can a start-up business get a commercial mortgage?
Yes, on an asset-backed basis. In our experience lenders advance around 65% to 75% of the property's value, and the case is stronger with sector experience, a credible business plan, projections and a larger deposit. Owner-occupied routes suit start-ups better than investment lending.
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