SEMI-COMMERCIAL MORTGAGE: Guide to Semi-commercial Mortgage In The UK

Semi-commercial mortgage

While residential and commercial properties both have distinct uniqueness, you cannot underrate the usefulness of semi-commercial properties. Semi commercial mortgage providers offer investors loans to get properties at different rates. Although semi-commercial lenders give out loans to individuals, it is advisable to calculate the term of the loan using the mortgage calculator, especially in the UK. Also, ensure the exact rates at which the loan providers are giving the semi-commercial mortgage.

Semi Commercial Mortgage

Semi-commercial mortgages are secured loans for properties with two purposes, these are properties with both commercial and residential purposes. While it serves as a residential home, some of its component units equally serve as office or business premises. It is simply a loan on an in-house business premise. That is a building where people live in some parts of it and the other parts are for business. Generally, they are for buying or remortgaging properties. They are also accessible for a wide range of properties.

Interestingly, financial experts consider it a commercial investment and as a result, landlords can use their income yield to balance any costs and loan interest accruing against it. Furthermore, semi-commercial mortgages slightly have a higher interest rate than regular buy-to-let mortgages. This means the amount of money you can borrow may be significantly different. One of the astounding benefits of a semi-commercial property is the extra income that comes with it. Investors can either decide to use the commercial aspect for their personal business or rent it out to other businesses,  thus using the income to offset their loan.

Examples Of A Semi-Commercial Mortgage Property

  • Shops with flats above them
  • Flats on the ground floor of a commercial building.
  • Owner-occupied vacation rentals.
  • Guesthouse with self-contained lodging.
  • Building with business offices and apartments.

Fees And Charges Of A Semi-Commercial Mortgage

Some of the fees that come with a semi-commercial mortgage include the following;

#1.Brokers Fee

Not all brokers charges for this service however, the normal fee is about 1-1.5% of the loan amount.

The legal fee depends on two main factors. The loan amount and the solicitors you hire. Usually, you pay a legal fee two times. The first is once the solicitor begins with the application and the last is once he completes it. Valuation Fee

You pay the valuation fee when applying because it is most often not inclusive of the total loan amount. 

  • Lenders  Arrangement Fee

The lender’s fee most often is about 0.75% – 2% of the total loan. Basically, this fee is paid upon the completion of a loan.

How To Obtain Mortgage For A Semi Commercial Property Investment

Before applying for a semi-commercial mortgage, consider the following; 

#1. Be up to 18 years and above. 

Semi commercial property is available to someone of eighteen years and above.

#2. Know your credit score

Never make the mistake of applying for a loan without foreknowledge of your credit score. Also, analyze your means of paying off the loan as well as the loan term.

#3. Contact a Mortgage Provider

Sometimes, a dual-purpose mortgage such as a semi-commercial mortgage is not available with every loan provider. This is because a semi-commercial property investment can only be obtained through a commercial mortgage lender. Also, these properties are slightly higher than residential properties. Nevertheless, you can still access up to 75%  LTV

Standard Documents For Dua Purpose Mortgage

  • Recent bank statement of both business and personal account
  • Copy of lease
  • I.D and Address
  • Mortgage History
  • Credit Report
  •  Application form

Semi-Commercial Mortgage Providers

Most often, finance is the sole reason why individuals fail to take advantage of the opportunities with dual-purpose properties. Nevertheless, mortgage providers are there to help you acquire your dream semi-commercial property. They help individuals by providing loan facilities. However, the amount of funds you can access depends on your credit record as well as other variables. These variables include but are not limited to the type of tenant lease that the commercial side of the property will need. Also, loans for these properties are only available through commercial mortgage lenders and the rates range from loans. Basically, can be as low as 2.5 % to as high as 7%.

The loan amount provided by semi-commercial as well as the rates of mortgage providers differs but mostly, there is a cut on loans above £100,000

While scouting for lendees, ensure you settle for one that best suits your interest. This is because lenders give out loans on different criteria. While some might offer you an interest-only option, may insist on mortgage repayment. This applies whether or not you will occupy the resident part of the building.

List Of Some Mortgage Provider

  • Abc finance
  • B2B finance
  • Close brothers property finance
  • Allica Bank
  • Ecology

Semi-commercial mortgage calculator UK

The semi-commercial mortgage calculator strategically helps you figure out how much money you might be able to borrow in the UK. It is built with simplicity to efficiently help investors with budgeting and cash flows. It also helps investors compare the rates of different lenders.  Thereby identifying the best offers. The interest rate on the loan will be determined by your specific circumstances and lender criteria. Furthermore, the semi-commercial mortgage calculator figures out its numbers using the property’s level of security and rental income. 

 You can check out this semi-commercial loan calculator to know how much you are eligible to borrow.

Semi-commercial mortgage Rates

Basically, the rates of Semi commercial mortgage is determined by your mortgage providers.

Below is a comparison of some top best semi-commercial mortgage provider and their rates.

75%Variable and
1 month – 8 years£25,000 – £20,000,000
70%Variable15 years – 25years£15,000 – £2,000,000
100%Variable and
1 year – 25 years£25,000 – Negotiable Amount
75%Variable and
2 years – 30 years£25,000 – Negotiable Amount


The provision of loan facilities by commercial mortgage providers is most assuredly, an amazing way of owning a dual purpose property. Also, the income from these properties helps in financing your loan. Therefore, it is a good investment to consider in the UK. Particularly with the increasing population.

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