Semi commercial mortgage

[simonm]

Anyone have any experience with a semi commercial mortgage?

We have finally seen a property with land attached that i want to use as a yard.

[Rhystree]

I don't but will follow this as I'm in the same situation.

[aspenarb]

Its not hard to finance this sort of thing but you will need a 30% deposit .

 

Lloyds are good for this https://www.lloydsbank.com/business/industry-focus/agriculture.asp

 

https://www.lloydsbank.com/business/retail-business/loans-and-finance.asp?#tab-row-5

 

Bob

Edited May 13, 2017 by aspenarb
fat fingers

[jamesd]

I would like to do a similar thing so would like to know how you get on with this.

What would happen to the land/property if you ended your business or retired?

[Chris Day]

I'd chat to the accountant and solicitor first. It may be possible for you to buy the whole property and then rent the yard to the business until the mortgage is paid and then sell the yard to the business. Not exactly sure of the quirks but believe this will have tax benefits and insure the property against bankruptcy of the business (I hope this is never the case) as it doesn't own the land.

[richy_B]

I think this is absolute the case. You own the property and rent it to the business, preferably a LTD. I wouldn't like the risk that you could lose the lot if something terrible happened in the business.

[Billy]

Discussed this with my accountant and for a small business doesn't seem ideal for the business to be directly involved. There are some quite severe capital gains issues among other things

[donnk]

commercial loans are expensive, you will pay a lot of fees (£10k is normal) have a crap APR expect double residential and have onerous terms. You will need to have 30% cash and loose cash of another £15k for the fees/legals.

 

You will more than likely better off raising a BTL on your home and cash purchase the commercial. If a BTL + your ready cash (£30k deposit min on £100k purchase)still isnt enough to outright purchase the land then save up more.