For businesses to annex a commercial property, it requires significant investment, and often external funding!
Funding options
Understanding funding options is paramount when purchasing a commercial property, and the options vary depending on your needs and circumstances.
Some of the options include:
- Commercial mortgages – The most traditional option, a commercial mortgage is a loan based on the property’s value, provided by a lender such as a bank, typically requiring a deposit to secure the loan.
- Auction funding – Akin to a bridging loan, these provide access to funds without making any long-term commitments, though often have higher interest rates and short repayment terms.
- Private financing – If the investment is part of a growth strategy, there may be access to a private investment.
Government funding may be available, especially in cases where a small business is looking to purchase a sustainable property.
Should I seek legal advice?
In short – yes!
The prospect of establishing a long-term relationship with a lender, the legalities of the purchase, and the whole journey in between make it good practice to seek independent legal advice.
The benefits of legal advice are:
- Understanding loan terms – A skilled solicitor will be able to navigate you through the entire process, ensuring all legal requirements are met, and any failures to repay the loan or deliver a return on investment are understood.
- Secure your interests – A legal advisor will be able to identify contractual areas that are overly restrictive or do not act in your best interest.
- Identify risks – Legal advice ensures compliance with relevant regulations and tax laws, avoiding unwanted surprises.
Get in touch with our team for further advice on funding commercial property transactions.
