Interest only commercial mortgage

Interest only commercial mortgages are arranged with repayments that only cover the interest of the mortgage. Repayments themselves do not repay any of the capital. Businesses can repay the capital itself through a number of ways, but will have to prove they are able to do this. Insurance, investment and asset sales are all options that can be used.

The upside of an interest only mortgage is that the monthly cost is considerably lower than for a comparable repayment mortgage.

• The downside of an interest only mortgage is that at the end of the mortgage term you still owe the original amount you borrowed.
  
  
• Interest only commercial mortgages can be of great benefit to businesses that wish to have lower regular repayments in the expectation of being able to provide a lump sum for complete pay-off within a number of years. However, careful plans need to be made to ensure that this is the case and you may have to provide proof of this.
  
  
• Commercial mortgages may carry higher interest rates than residential mortgages because commercial mortgages are considered a higher risk.
  
  
• Call Barket Financial Management today to discuss the best deals to suit your business financing options.

Need more help or advice?
Barket Financial Management will guide and help you find the best products and services to suit your requirements and circumstances. To discuss your options in more detail, please call one of our friendly team on +44 (0)1582 482333 or complete an online enquiry here.