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Categories: commercial mortgage guides | limited company mortgage guides

When borrowing to invest in property it is important to get to grips with the type of product you need, based on your scenario. A lot of people mix up needing a limited company buy to let mortgage with needing a commercial mortgage.

Mortgage interest rates vary depending on the type of property you are investing in, which all comes down to the risk profile of the building, including factors such as its resaleability and intended use.

Within the specialist property investment industry, there are mortgage products for lots of different property types. When you are researching online or talking to our broker team, if will be useful to be clear on type of mortgage you need. 
Watch our video guide below to understand the difference between commercial and other sorts of mortgage types, so you can proceed confident in your requirements.

 

Video guide transcript: Do I need a commercial mortgage?

“A lot of people mix up needing a commercial mortgage with needing a limited company buy to let mortgage. 

“They think that when they're saying, they want to invest via a limited company, that that means they need a commercial mortgage.

“It's really important you understand the difference. A commercial mortgage is for a premises that a business operates from. Or, it might be a semi-commercial mortgage, where there's a bit of both, maybe a shop with a flat above. 

“It’s important to understand this when you're doing a mortgage interest rate research, because mortgage interest rates for a commercial mortgage are a lot higher than mortgage rates for a buy to let limited company. 

“And, similarly, if you are investing in a holiday let via a limited company that does not require a commercial mortgage either. And so I wouldn't ever want anyone to be looking at commercial mortgage interest rates, thinking that they applied to their Investments scenario.

“If you're investing in a property that somebody's going to live in, whether that's an AirBnB, whether that's a holiday let or whether it's a buy to let mortgage or an HMO, you do need a specialist buy to let mortgage, but you don't need a commercial mortgage.

“I hope that clears that up. 

“If you want to invest in any of those property types, commercial mortgages, business premises, holiday lets, HMOs or buy to let through a limited company, give our team a call, we'd be delighted to help.”