Commercial Mortgages

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What Will The Initial Costs Of Buying A House Be?: Before you actually move into your new property – you will have to pay a series of initial costs to cover the following:
Income Multiples Explained: If you are an employee, the majority of mortgage lenders will calculate the maximum size of a mortgage loan based on your salary.
Is There Any Way I Can Lower My Monthly Repayments Without Switching Mortgages?: If you find that you cannot afford your monthly mortgage repayments and do not wish to switch your mortgage to another lender – then you will need to negotiate new terms with your existing lender.
How Do I Switch Mortgages?: Switching mortgages (remortgaging) has been made very easy by the industry, in reaction to the fact that most people remortgage their homes on a regular basis i.e. every 5 years on average.
Information For 1st Time Mortgage Buyers: Your first mortgage will be the most significant financial undertaking of your life so far, but how exactly do you go about getting a mortgage?

A commercial mortgage is probably the best way to finance the purchase of buildings and land for business purposes, it provides the most flexible and affordable finance solution. Commercial mortgages are specialized due to the fact that the lender has a legal claim over the property until the loan has been repaid in full.

Remember when arranging a mortgage; always consider its effects on your cash flow and assets. This section will give you a general overview about Commercial Mortgages but it doesn’t replace professional advice in any way. You should always consult your accounting and financial advisors before finalising a loan to get the maximum benefits and avoid any complications.

Advantages and Disadvantages of Commercial Mortgages

Advantages:

Retain Ownership: Instead of raising funds by selling a share in the property or the business to an investor, you retain complete ownership. The lender is only entitled to an interest return on its mortgage, not a percentage of ownership that an investor would expect. Also they can only exercise the right if you default on payment. You retain all the benefits of ownership in an asset that has the potential to increase in value.
Tax advantage: Interest payments on your mortgage are tax deductible and are made with pre-tax money.
Better Cash Flow: A mortgage gives you access to capital that you would not normally have axes to with minimal up-front payments and the flexibility to design a repayment plan that suits your needs.
Simplified cash flow management: Mortgage schedules are at preset, making cash management more predictable.

Disadvantages:

Collateral: The nature of a mortgage requires you to pledge the purchased property to the lender. If you default on the mortgage, the lender is able to foreclose the property and sell it to repay the outstanding money owed to the lender. Make sure when the mortgage is repaid; the lender is obligated to release the mortgage and is required to make available any government files acknowledging this release.
Defaults: The lender may define a variety of events that will constitute a default on the mortgage, including failure to make any payment on time, bankruptcy, insolvency and breaches of any obligations in the mortgage agreement. Try to negotiate an advanced written notice of any alleged default, with a reasonable amount of time to cure the default.

What if I have mortgage arrears ?

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