
Commercial Mortgage for Business Premises & Development Land
Flexible funding secured despite valuation challenges
Business Premises & Development Land
Our client is an MOT and car sales business owner who had been leasing his trading premises long-term.
When given the opportunity to purchase the site for £225,000, along with an adjoining £120,000 plot for future residential development, he was keen to proceed through his limited company for both flexibility and tax efficiency.
However, challenges quickly emerged. Traditional lenders declined the application due to affordability concerns based on historical accounts, despite strong trading and healthy income projections.
Further complications arose when the lender’s valuation came back significantly lower than the combined £345,000 purchase price, creating a funding shortfall that threatened the transaction.
We sourced a flexible challenger lender willing to lend against projected income and take a pragmatic view of the security offered by both the commercial premises and the development land.
When the valuation came in at just £253,000, we worked closely with the client to overcome the gap. He raised extra funds for the deposit and successfully renegotiated the purchase price with the sellers.
The result was a commercial mortgage of £153,000 over a 10-year term, at a competitive rate of 0.83% per month. The client now owns his premises outright and has secured the adjacent land, positioning his business for long-term stability and potential residential development.

Overview of Case Study
- Product: Commercial Mortgage
- Loan Amount: £153,000
- Loan Term: 10 Years
- Combined Purchase Price: £345,000
- Interest Rate: 0.83% per month
Ref no – CS24
