Just as there are a range of available commercial property mortgage types, there is also a spectrum of commercial mortgage lenders. Each comes with pros and cons, but it can be difficult to compare the information provided by individual lenders. We’ve compiled a broad overview of the main types of commercial lenders we can approach on your behalf.
Commercial mortgage lenders
In terms of securing a great rate, high-street banks are generally going to be able to provide the cheapest loan. If you’re eligible for their criteria, and not bound by time constraints, then a commercial loan from a high-street bank may be the route for you.
However, there are also some real downsides to borrowing- or attempting to borrow- with a high-street bank. A real problem for commercial borrowers on a tight timeline is that high-street banks regularly take several months to reach a decision. In a fast-moving business environment, this may pose a serious problem. High-street banks also often have very stringent lending criteria, and will generally require a higher income to service the debt.
If you’re looking for flexibility in your commercial mortgage, your best option may be to borrow with a specialist lender. For example, specialist commercial lenders may be better for those who are new to commercial finance, as they are generally prepared to offer loans to those with less business history.
Specialist lenders offer speed and flexibility
If time is of the essence, or you need your lender to be flexible in another way, a specialist lender may be the appropriate option. However, there is a cost to pay for this flexibility—the rates on a loan from a specialist lender will nearly always be higher.
There is a middle ground—you could consider borrowing with a challenger bank. Challenger banks who are looking to compete with the long-established national banks are hungrier for business, so although their fees and rates may be higher than the high-street banks, they may consider working with clients who have issues in their credit history.
Choosing which sort of lender to approach can be difficult, unless you have extensive knowledge of exactly how each lender works and what their preferences are. Fortunately, Enness Commercial has over 20 years of experience in commercial lending and has built up fantastic relationships with a range of lenders, enabling us to secure you the right offer from across the spectrum of options.