A commercial mortgage is when you buy property upon which you may live and run a business from. This is an ideal mortgage for shopkeepers who work long hours and have living accommodation above for them. The mortgage is very specialised and only offered by a handful of lenders.

You do not have great increases in rent if you own the property yourself.

You have the freedom of sub letting parts of your property off to other businesses, which would help towards your mortgage repayments.

You can build extensions to the property or refurbish the property in order to grow your business with out getting the landlords consent.

No hassles with the landlord over leaking pipes etc.

You benefit from any property increases.

For the mortgage you must also place a substantial amount of cash down as deposit, this is money which could be used to improve your business.

It makes it more complicated when relocating your business as both the living accommodation and the business must be sold. Many people may want to buy both the business and the property which means that you must stop trading.

Although the rent may not increase you would have to pay the mortgage according to the interest rate increasing or decreasing along with any land taxes you may have to pay (council tax).

Mortgage terms are different through every lender and are made according to the type of business you are running and the location. Sometimes lenders will only lend the borrowers the trading amount when applying to buy pubs and hotels. If the business is under performing but the property values are high the lending amount can rise. Many lenders will on lend up to 75% to 80% of the property value.

Always look around for the best deal when taking out a commercial mortgage, if you need help finding lenders consult mortgage brokers who have a large database of lenders and the rates.