We were approached by a broker whose clients are a married couple who were looking to refinance their live-work property located in a popular Cheshire town.
The building has three floors. On the ground floor is a shop from which they have run a fine food and wine merchants for 30 years. Above it is their living accommodation.
The couple needed to remortgage because their existing private finance provider required repayment.
They wanted a deal that would be similar to their existing loan terms – a rate of around 4% on an interest only basis.
The interest-only part was a challenge for us because many lenders prefer capital and interest repayments on commercial mortgages.
Also, more than 40% of the property is designated residential which can be tricky to fund.
However, we approached a building society which specialises in the more unusual commercial deals and after some negotiation the following terms were offered.
Property value: £730,000
Loan amount: £430,000
Rate: 4.49% term tracker
Term: 5 years interest only
Borrower: Joint personal application
Mortgage payment: £1,609 pcm
Lender arrangement fee: 1.5% (£6,450)