The Benefits of a Commercial Mortgage

discussing financial planning
Owning a commercial property can be a significant business asset. However, it's also a substantial investment, so your business finance needs to be watertight. And that includes your commercial mortgage

Why use a commercial mortgage?

So why use a commercial mortgage? Because it lets you do much more than buy your bricks and mortar. You can also use this type of business finance to purchase land, develop new premises or extend existing ones. If this kind of flexibility is just what your business is looking for, then a commercial mortgage is a great way to finance your future.

In addition, there are plenty of other benefits to financing your new business home with a commercial mortgage.

Affordable Investment /business security / Lower interest rates

Commercial mortgages typically come with lower interest rates than other debt taken in the business which is usually unsecured. So when you're calculating your monthly outgoings, making a fixed repayment ensures accurate planning and forecasting, letting you structure your business finance with more certainty. And because your commercial mortgage is a long-term investment, you can get on with developing your staff and growing your business.

No 'dead money' rent repayments

Another benefit of making lower monthly repayments is the savings you'll make against paying rent. You'll save money over the period of occupancy, and your money will work harder for you as your equity in the building grows. So instead of making 'dead money' payments to a landlord every month, you'll be investing in the future of the business.

Capital gains

The commercial property market isn't showing signs of slowing down, with prices continuing to trend upwards. Although nothing's ever certain when buying property, there's a good chance your commercial investment will deliver significant returns, particularly if you buy in the right areas. So whether you're looking to realise capital growth over the long term or benefit from a lump sum towards retirement, property is an intelligent investment. Remember, Capital Gains Tax could apply to any profits, but business tax relief is available.   

Make your property work for you

Once you own a commercial property, you can start to monetise it. For example, you could rent out unused office space or charge for the use of parking spaces and storage rooms. Of course, opportunities to generate additional income don't exist when you rent. Still, they're one of the big advantages of owning your own premises with a commercial mortgage.

First impressions

In business, first impressions make a big difference. So if you're regularly meeting with customers and clients, it's worth investing in business premises that allow you to project a professional image. You'll have complete control over decorating and landscaping and can customise the space with your brand colours and logos. 

It's challenging to find that kind of flexibility in a landlord-controlled environment, but your business presentation makes all the difference.

Ending your mortgage

A commercial mortgage won't tie you down if you need to move on from your business premises. For example, you may want to move to bigger premises to fulfil your business growth plans, or you might want to change your current commitments. Whatever the reason, getting out of a long-term lease can take time and effort. But whatever your reason for selling up, a commercial mortgage gives you plenty of options to realise your assets in a way that works for you.


Funding Round has you covered if you're looking for business finance to support your plans. From property finance to business asset financewe're the B2B finance experts. Contact us today, and we'll be happy to discuss your next business move.