£800k Semi-Commercial Mortgage — Owner-Occupier Premises

01

Client Situation

An established heating and plumbing business in South West London had been trading from leased premises for several years. The freehold — a commercial unit with a self-contained residential flat above — became available at £800,000, giving the owner the chance to secure their trading base and add a rental income stream.

02

The Challenge

The mixed-use (semi-commercial) nature of the property placed it between residential and pure commercial lending, and the owner wanted to weigh a longer-term mortgage against a faster bridging route. They needed clarity on which structure genuinely served the business — not simply what was quickest.

03

Lender Considerations

A semi-commercial owner-occupier case turns on the strength of the trading business as the source of repayment, the split between commercial and residential value, and the lender's comfort with mixed-use security at the chosen loan-to-value.

04

Structure Used

We reviewed the existing arrangements and set out two clear options — a term mortgage or a bridging loan — with the trade-offs of each. The owner chose a 20-year semi-commercial mortgage at 75% loan-to-value on a rate of base rate + 2.35% with a prime lender, structured around the business's trading performance.

06

Key Lessons