by Kate | Oct 31, 2025
A commercial mortgage is a secured loan used to purchase or refinance a property that will be used for business purposes. A business property could be an office building, a shop, a warehouse, a factory, or even a mixed-use property.
Because these loans often involve large sums of money and properties with more complex values than residential homes, lenders are careful to assess both the borrower and the asset before agreeing to lend. The application process is more detailed than for a standard residential mortgage.
Requirements for a commercial mortgage
Business and financial information
Lenders want to understand the nature of your business and how it operates. The stronger and more stable your business appears, the better your chances of securing a commercial mortgage on favourable terms.
- Business history and type: Some industries are seen as riskier than others. For example, hospitality and start-up retail businesses can be regarded as more volatile, while established professional services or manufacturing tend to be more stable. A company with a long trading history is generally viewed more favourably than one that has been operating for only a short period.
- Financial statements: Ideally, lenders would like to see at least two to three years of profit and loss accounts and balance sheets. These assist the lender in assessing profitability, debt levels, and overall financial stability. A steady or increasing profit margin is a positive indicator. However, it is still possible to obtain a commercial mortgage with only limited financial information.
- Tax returns: These are used to verify the income figures you provide in your financial statements and to ensure there are no discrepancies. They also help lenders confirm the business’s tax compliance.
Income projections: Especially for newer businesses or properties that will generate rental income, lenders might request forecasts of future revenue. These forecasts should be realistic and supported by market research, existing contracts, or signed lease agreements.
- Business experience: If you or your management team have a solid track record in your sector, lenders may have greater confidence in your ability to operate successfully and manage the property profitably. However, we can and do assist new entrants secure finance.
Creditworthiness
Even with a strong business case, lenders need reassurance that you have a history of meeting financial commitments. They will usually look at both the business’s credit profile and the personal credit record of the directors or owners.
- Credit history: A record of missed payments, defaults, or County Court Judgments (CCJs) can lower your chances of approval. Lenders seek a history that demonstrates responsible borrowing and punctual repayments.
- Credit score: Higher scores typically lead to better interest rates and terms. Although there’s no universal threshold, a strong score can lower perceived risk and encourage lenders to offer more favourable conditions.
Collateral
A commercial mortgage is a secured loan, meaning the lender can take possession of the property if the loan isn’t repaid. The property itself forms the main security for the loan.
- Property value: Lenders will organise an independent valuation to establish the property’s market value. This valuation takes into account location, size, condition, and local demand. If you are purchasing an investment property, the potential rental yield may also be included in the valuation.
- Loan-to-value (LTV) ratio: Most commercial lenders prefer an LTV of 70–75% or lower, meaning you may need a deposit of 25–30% or more. Lower LTV ratios are less risky for the lender and can result in better interest rates for you.
Legal and regulatory compliance
Lenders must verify that both the business and the property comply with all applicable legal and regulatory requirements before proceeding with a loan.
- Legal standing: The lender will check that your business is properly registered, up to date with Companies House filings, and free from significant legal disputes.
- Licences and permits: Certain types of commercial property require specific licences (e.g., a premises licence for a pub). Lenders may request proof that these are in place or can be obtained.
- Regulatory compliance: This includes health and safety regulations, environmental standards, and planning permissions. If the property is non-compliant, lenders may refuse the loan or require corrective work before completion.
Other considerations
While the above are the core requirements, lenders may also take into account:
- Deposit size: A larger deposit lowers the lender’s risk and can enhance the terms you receive.
- Personal guarantees: In some cases, particularly with small businesses or start-ups, lenders may require personal guarantees from directors.
- Repayment method: Some lenders may offer repayment mortgages (capital and interest) or interest-only options, depending on your circumstances.
- Exit strategy: If you’re applying for an interest-only or short-term commercial mortgage, the lender will want to know how you intend to repay the capital at the end of the term. This could be through property sale, refinancing, or business profits, for example.
Why using a commercial finance broker can improve your chances
The commercial mortgage market is more complex than the residential market, with different lenders specialising in various property types, sectors, and loan sizes. Knowing which lender is most likely to approve your application, and on what terms, can save a lot of time and frustration.
A specialist commercial finance broker can:
- Identify lenders that match your specific business profile and property type.
- Help you prepare and present your financial information to meet lender expectations.
- Negotiate on your behalf to secure competitive interest rates and terms.
- Anticipate potential lender concerns and address them before they become obstacles.
How ASC can help you secure the right commercial mortgage
At ASC, we’ve been helping businesses access commercial finance for over 50 years. We recognise that every client’s situation is unique, and that securing the right mortgage involves more than ticking boxes on a checklist.
We take the time to understand your business, your plans for the property, and your long-term objectives. Then we match you with lenders who not only meet your requirements but are also likely to view your application favourably.
From gathering the necessary documentation to liaising with valuers, solicitors, and lenders, we manage the process from start to finish. Our goal is to make securing your commercial mortgage as straightforward as possible, while negotiating terms that work in your best interests.
If you’re ready to take the next step toward purchasing or refinancing a commercial property, get in touch with ASC today. We’ll guide you through the process, improve your chances of approval, and help you get the funding you need to achieve your business ambitions.
by Conrad Robins | Jul 21, 2025
Client: Transport and logistics company
Facility: £400,000 loan
Purpose: To purchase a freehold property
Background: Supporting a growing logistics company
Over the course of six years, our client had built a successful logistics business, now operating a fleet of eight HGVs with an operating licence for 15 vehicles and experiencing year-on-year growth.
The business approached ASC seeking a commercial mortgage for logistics expansion, enabling them to purchase premises close to their existing yard. The purchase price was £715,000, and they required a loan of £400,000 to add to their £315,000 deposit.
The site would allow them to be nearer to their vehicles and reduce the rent they pay on two separate warehouses and an office. They planned to acquire the property in a holding company and rent it back to their trading business, Elevation Logistics Ltd.
Challenges: Securing a commercial mortgage under pressure
The property was advertised with vacant possession. However, during the purchase, it emerged that one of the units was occupied by a protected tenant. The bank wouldn’t lend until the lease issues were resolved, and the transaction subsequently collapsed.
Solution: Fast turnaround on logistics finance
We sourced a lender experienced in commercial mortgages for logistics companies, ensuring the deal completed in under a month. Learn more about how ASC helps businesses secure commercial mortgages quickly and efficiently.
Outcome: Successful purchase and long-term savings
Our client has successfully completed the purchase of their new premises, saving £14,400 per year on the rent for the office and warehouses.
Eleven months later, after the tenant had signed a new lease, we refinanced with the original lender on a longer-term arrangement with significantly lower monthly repayments.
by Conrad Robins | Jul 2, 2025
Our tailored finance solution helped the agency secure the perfect space and confidently step into property ownership.
Client: Nera Marketing
Facility: £135,000 mortgage
Purpose: Purchase of a commercial unit to facilitate business growth
Background – First business premises
Nera Marketing, has built up several years of experience in the digital marketing sector and has recently taken the next step by expanding its operations and establishing a new limited company.
This growth has enabled Nera to offer a full suite of services, including website design, Google Ads management, search engine optimisation (SEO), and a variety of associated marketing solutions, all from a rented commercial unit.
Our client was seeking finance to purchase a commercial unit that would support the business growth and reduce ongoing rental costs.
Challenge – Securing finance
Securing finance proved difficult, as the limited company had only one year of trading history. Most lenders require at least two years of accounts and a proven track record to be confident that the borrowing can be serviced.
Several high-street banks had declined the application, stating that it was too early for finance and that there was no track record to support it.
Solution – Identified a lender open to projection-led funding
With our in-depth knowledge of the lending market, we identified a lender open to projection-led funding. We worked closely with our client to develop a robust business plan, clearly demonstrating how the purchase of the freehold would support business expansion, create new jobs, and generate sufficient cash flow to meet the loan repayments.
Outcome – successfully secured a £135,000 mortgage
We successfully secured a £135,000 mortgage to fund the purchase of the commercial unit. As a result, Nera Marketing now benefits from:
- Ownership of a valuable business asset
- Greater financial stability by eliminating rent payments
- Security of tenure, with no risk of rising rental costs
- The ability to expand operations, thanks to the additional space the new unit provides
“Working with ASC Finance for Business has been absolutely brilliant. From the start, they were fast, responsive, and genuinely listened to exactly what we needed. Even at an early stage — when other lenders had turned us away — ASC offered their expertise and believed in the potential of our business.
“Thanks to their support, we secured funding to purchase our own commercial unit. This has given us the freedom to invest more into our business, expand our operations, take on new staff, and improve the space now that we own it. We couldn’t recommend them highly enough.”
— Nera Marketing Ltd
by Conrad Robins | Jul 13, 2024
Background – how the opportunity arose and who was involved
With the help of ASC, a green-fingered couple has saved one of Kent’s last remaining market gardens and realised their dream of owning a fruit and vegetable business.
Paul and Michelle Vesey-Wells are now the proud owners of East Kent Growers Ltd (formally known as Walmestone Nursery) in Kent after ASC’s Alister Golesworthy secured the financing to enable the purchase as sitting tenants. With the eight-acre site and farmhouse up for sale by the owners, Paul, Michelle, and their family faced being left jobless and potentially homeless.
Challenges – financial pressures and time constraints
The hardworking and dedicated couple, who had worked there for nine years, were desperate to buy the business to stay in their cherished home and keep the thriving community market garden alive. So they started the seemingly impossible task of raising £650,000 of finance to buy the business and site.
Entrepreneurially, the couple launched a crowdfunding campaign to add to their deposit. The local community got behind this much-loved local business asset, and the campaign secured an impressive £5,000.
Solution – how ASC supported the process
The couple then sought help from ASC to secure a loan towards the purchase price. Time was of the essence as the owner’s marketing agent was arranging viewings by potential purchasers.
Alister introduced a specialist solicitor, Aly Young Law, who explained how to arrange a third-party share deal to help obtain additional deposit funds via a share scheme, the agreement then being completed by the client’s solicitors. Alister, also approached the agricultural lending team at NatWest, who he knew would see the benefits of keeping the business in local and experienced hands and oversaw the whole process to ensure the deal went through.
Outcome – successful purchase and long-term stability
With Alister’s help, Paul and Michelle obtained a £400,000 structured commercial mortgage and continue to enjoy running East Kent Growers Ltd. The future of their thriving local business is now secure, and they can continue serving their community, from individuals to Michelin Star restaurants.
Alister Golesworthy said, “We live in Kent, so saving this important community asset was a pleasure. If you’re a sitting tenant or have the opportunity for a buyout, we would love to help you. Please get in touch.”
Image credit: East Kent Growers Ltd
by Conrad Robins | Oct 5, 2023
Background – Supporting a trusted local business partnership
Mr Li & Mrs Sasikumar are well known and appreciated clients of the Hampshire, Dorset & Isle of Wight office of ASC Finance for Business.
We were first introduced to Mr Li & Mrs Sasikumar by a trusted introducer in November 2020, to help with their commercial funding requirements.
Since the introduction, we have supported NGG & More Limited, as well as their other associated businesses to obtain commercial finance for their various ventures.
Challenges – Expanding into a new local store after 25 years
Mr Li & Mrs Sasikumar were keen to purchase the convenience store in Water Lane, Totton, as there hadn’t been one in 25 years. Our clients knew there would be a large footfall as it’s close to the centre of Totton, and there would be a local need for the store to open. The shop has been open a few months now and the footfall into the store is ever increasing.
Solution – Helping secure funding for growth and expansion
Mr Li & Mrs Sasikumar, have great plans for the store. They are looking to extend out the back to give greater floor space, which will allow more of a range of products to sell. Our clients’ will be installing a coffee and lottery machines on the premises, to bring in the extra revenue.
Our clients have two other convenience stores which they have brought and are running successfully. Once based in Freemantle and the other is in Regents Park in Southampton.
Outcome – Continued success and lasting client relationships
When asked why they come back to ASC Finance for Business for their commercial finance requirements, our clients advised:
“It is always a pleasure to work with ASC, there is always someone there on the phone to provide the latest update and push the process forward. Dan and Lisa understand every single detail from our side and point of view regarding the application, there is no barriers in communication. It is not easy to find a similar company with the same professional competencies and the level of attitudes.”
Dan Gateshill, Regional Director for ASC in Hampshire, Dorset & Isle of Wight commented:
“We have assisted Yi and Amsadevi on several occasions with their commercial funding requirements. One of the benefits of being a broker is to see how our efforts manifest and assist our clients to achieve their goals. Yi and Amsadevi now operate several businesses in and around Southampton and we are proud to have supported them on their journey.”
You can find out more about Water Lane Store here
