How to Get a Commercial Mortgage: Step-by-Step Guide

A commercial mortgage is one of the most effective ways to finance a business property. Are you an entrepreneur looking to buy office space? Or maybe an investor purchasing a rental property? Whatever your goals, securing the right mortgage can be the key to success. However, the process can feel complicated, with complex eligibility criteria, documentation requirements, and lender options to consider.

According to recent Brickflow trends, commercial mortgage demand is soaring as more investors jump on opportunities.

Let’s explore the process of getting a commercial mortgage, from preparing a solid business plan to comparing lenders and overcoming common challenges. By the end of this guide, you will have a clear roadmap to securing the best deal for your business.

What is a commercial mortgage?  

Commercial mortgages are different to residential mortgages in several key ways, mainly due to the higher value of the properties involved and the complexity of financing options available. 

Unlike residential mortgages, which follow fairly standardised structures, commercial mortgages vary significantly depending on the type of property, its intended use, and the lender’s criteria. This is because commercial real estate encompasses a wide range of assets, from office buildings and retail spaces to warehouses and mixed-use developments, each with its own risk profile and lending considerations.

Due to this complexity, commercial mortgages aren’t typically pre-packaged products with fixed terms. Instead, lenders assess each deal on a case-by-case basis, structuring finance around the borrower’s needs, the property’s value, and the projected income it can generate. However, they do still adhere to regulations such as the pan-European Mortgage Credit Directive, which governs both residential and commercial lending.

Buy-to-let mortgages are actually a type of commercial mortgage since they’re used to finance properties that aren’t the owner’s main home. Compared to regular residential mortgages, they usually come with higher interest rates, bigger deposit requirements, and stricter eligibility checks. Generally, commercial mortgages fall into two main categories:

• Owner-occupied commercial mortgages: For businesses purchasing premises that they intend to operate from.
• Commercial investment mortgages: For investors acquiring properties to lease to tenants.

Given the complexity and variability of commercial mortgage products, navigating the market effectively can be a challenge. This is where technology like Brickflow can be invaluable. By giving brokers and borrowers access to real-time data, market comparisons, and digital applications, Brickflow streamlines the process, ensuring that the right finance is secured quickly and efficiently.

How easy is it to get a commercial mortgage?  

• A strong business plan and financial projections – Lenders want to see that your business has a clear strategy for growth and profitability, as well as detailed forecasts demonstrating how you will manage repayments.
• Deposit requirements – Unlike residential mortgages, commercial mortgages generally require a higher deposit, typically between 20-40% of the property’s value. The exact amount depends on the lender and the perceived risk of the loan.
• Credit history and trading performance – A solid credit rating and a strong trading history significantly improve your chances of approval, as they indicate financial stability and reliability.
• A profitable and stable business model – Lenders assess whether your business generates enough revenue to cover mortgage repayments comfortably, ensuring long-term sustainability.

Approval rates vary, but according to industry estimates, around 60%–70% of commercial mortgage applications are approved.

Given the complexity of commercial mortgage applications, it’s crucial to approach the process with the right information and lender connections. 

With Brickflow, you can get a Decision in Principle approved in minutes, meaning you can get projects going as fast as possible. You can run a search with Brickflow to find out if your deal stacks and compare the best lenders for your project. Our smart appraisal tool increases the likelihood of securing funding by helping you assess whether your deal stacks up before applying.

How to get a commercial mortgage: Step-by-step guide  

Step 1: Prepare a Business Plan

Lenders will want to see that your business is financially viable. A solid business plan should include:

• Business objectives: Your vision, mission, and growth strategy.
• Financial projections: Revenue forecasts, profit margins, and expected costs.
• Property usage plans: How the property will be used to generate revenue.

Step 2: Assess Your Financial Eligibility

When applying for a commercial mortgage, lenders conduct a thorough financial assessment to determine your ability to repay the loan. Unlike residential mortgages, where personal income plays a key role, commercial mortgage approvals rely heavily on business performance and financial stability.

Lenders typically evaluate:

• Credit history: A strong credit score reassures lenders of your reliability, increasing the likelihood of approval and potentially securing better interest rates.
• Business income & profitability: Demonstrating stable and sufficient revenue streams is essential, as lenders need confidence that your business can comfortably meet repayment obligations.
• Debt-to-income ratio: A lower level of existing debt improves your eligibility, as it indicates a lower financial burden and reduces perceived lending risk.

It’s also important to factor in the costs associated with a commercial mortgage, which typically include arrangement fees (1%-2%), valuation fees, and legal costs. These can add up, so careful planning is essential.

If your financial standing isn’t quite where it needs to be, taking steps to strengthen your credit profile and business performance before applying can significantly boost your approval chances. Using a platform like Brickflow helps streamline the process, giving you access to the right lenders, comparing terms efficiently, and increasing your chances of securing the best possible funding.

Step 3: Gather Necessary Documentation

Expect to provide:

• Proof of income (bank statements, tax returns).
• Business accounts and financial reports.
• Details of outstanding debts.
• Property valuation reports.

Step 4: Compare Lenders and Find the Best Deal

Different lenders offer varying interest rates and terms. Shopping around is crucial. A skilled broker can help you navigate the market and secure the most competitive terms by:

• Exploring multiple lender options – From high-street banks to specialist lenders and alternative finance providers, each offers different advantages depending on your needs.
• Leveraging technology for better comparisons – Platforms like Brickflow streamline the search process, allowing brokers and borrowers to compare commercial mortgage options efficiently and access the most suitable lenders in seconds.

By working with the right broker and using smart technology, you can save time, improve your chances of approval, and ensure you’re getting the best financing solution for your commercial property.

Step 5: Submit Your Application and Follow the Process

Once you’ve selected a lender, the commercial mortgage application process moves through several key stages, each requiring careful preparation and due diligence. Unlike residential mortgages, commercial lending involves more complexity, and there may be back and forth between you, your broker, and the lender before final approval.

Here’s what to expect:

1. Pre-approval & document submission – The lender will conduct an initial assessment of your financial position, business viability, and the property itself. You’ll need to provide documents such as financial statements, business plans, proof of income, and details of the property. This step helps determine if you meet the lender’s criteria before moving forward.
   
   
2. Property valuation & underwriting – A professional valuation is arranged to confirm the property’s market value and assess its suitability as security for the loan. The lender’s underwriting team will also review financial risks, potential rental income (if applicable), and exit strategies. At this stage, lenders may request further documents or suggest amendments to the loan structure.
   
   
3. Final approval & mortgage offer – Once underwriting is complete and all conditions are met, the lender issues a formal mortgage offer. You’ll review the terms and work with your solicitor to finalise the legal process before funds are released.

How long does it take to get a commercial mortgage?  

The typical timeline for securing a commercial mortgage in the UK is 8 to 10 weeks, but this can vary depending on several factors. Some applications may move faster, while others can take longer due to complexities in the deal. Here are some key factors that influence the process:

1. Complexity of the Application

Certain property types and business models require more detailed assessments, which can slow down approval. Examples include:

• Mixed-use properties (e.g., a shop with flats above)
• Specialist sectors (e.g., healthcare, hospitality, or student accommodation)
• Unconventional business models (e.g., co-working spaces or short-term lets)
• Properties requiring heavy refurbishment (as lenders need to assess the viability of the project)

2. Lender’s Processing Speed

Each lender has different approval procedures, and some are faster than others. High street banks often have more stringent checks, while specialist lenders or private funders may move quicker. Some lenders offer fast-track services for straightforward cases, but more complex deals typically undergo a lengthier underwriting process.

3. Property Valuation Delays

A thorough valuation is essential to confirm the property's worth and ensure it meets the lender’s security requirements. Common causes of delays include:

• Limited availability of qualified surveyors
• Difficult-to-value properties, such as listed buildings or large industrial sites
• Discrepancies in valuation reports, which may lead to further investigations

How to Speed Up the Process

• Prepare all required documents upfront (business financials, property details, etc.)
• Work with an experienced broker who knows which lenders are best suited to your case
• Use platforms like Brickflow to quickly compare lenders and access faster decision-making processes

While delays can happen, working with the right professionals and being well-prepared can help keep your mortgage application on track.

It's important to note that the overall duration can fluctuate based on the specific circumstances of each application. Engaging with experienced mortgage brokers or financial advisors can help navigate the process more efficiently. 

Brickflow brokers aim to get you the best deal as quickly as possible, getting you a Decision in Principle in minutes, not days, and making sure the entire process is streamlined and easy. Compare commercial mortgage rates, fees and loan-to-value ratios instantly and make sure your deal stacks against live borrowing costs

Common challenges and how to overcome them  

1. Insufficient Deposit Funds

Commercial mortgages typically require a deposit of around 20%-40% of the property's value.

If accumulating this amount is challenging, consider these alternatives:

Alternative Financing Options

Some businesses can take advantage of unsecured financing — a type of loan that doesn’t require assets like property or equipment as collateral— to bridge short-term funding gaps. This allows them to access capital quickly and flexibly, helping to cover operational expenses, invest in growth, or seize new opportunities without tying up valuable assets. For example:

• Unsecured business loans – Established businesses with strong financials may qualify for a loan to cover part of the deposit.
• Director’s loan – Business owners may inject personal funds into their company as a loan to use for the deposit.
• Crowdfunding or peer-to-peer lending – Alternative finance platforms can provide access to funding, though at potentially higher interest rates.
  
  

Asset Leverage

If you or your business owns valuable assets, they can be used to raise capital. This includes:

• Refinancing existing properties – If you own other commercial or residential properties, releasing equity through refinancing can generate funds for the deposit.
• Using business equipment or inventory as collateral – Some lenders allow asset-backed lending against vehicles, machinery, or high-value stock.
• Personal assets – In some cases, directors may use personal savings, investments, or even pension funds (via an SSAS pension) to contribute towards the deposit.

2. Poor Credit History

A less-than-ideal credit history can hinder mortgage approval. To improve your creditworthiness:

• Credit Score Improvement: Focus on enhancing your credit score by settling outstanding debts, ensuring timely payments, and correcting any inaccuracies in your credit report.
• Specialist Lenders: Some lenders specialise in assisting applicants with adverse credit histories, offering tailored solutions based on individual circumstances.

3. Lengthy Approval Process

The commercial mortgage approval process can be time-consuming. To expedite it:

• Engage a Mortgage Broker: Mortgage brokers have access to multiple lenders and can navigate the application process efficiently, potentially reducing approval times.
• Prepare Thorough Documentation: Having all necessary documents organised and readily available can prevent delays during the lender's assessment.
• Make sure you talk to your broker to find the best option for you. Brickflow brokers have access to the best deals and financing options available, specifically for you. 

By proactively addressing these challenges, you can enhance your prospects of securing a commercial mortgage that aligns with your business objectives.

Alternatives to a commercial mortgage  

If a traditional commercial mortgage isn't the right fit for your needs, there are other financing options to consider:

• Bridging Loans – Ideal for short-term funding, bridging loans can help secure a property quickly while you arrange longer-term financing. They’re commonly used for auction purchases, chain breaks, or refurbishments before refinancing. Read more about bridging loans here.
• Development Finance – If you're purchasing a property with plans to renovate or build from the ground up, development finance may be a better solution. It provides staged funding based on project milestones. Learn more about development finance here.

Choosing the right finance depends on your goals, timeline, and financial position. A broker or lending platform like Brickflow can help you compare your options and secure the best funding solution.

How Brickflow can help  

At Brickflow, we make securing a commercial mortgage easier by:

• Giving brokers access to competitive mortgage deals – Ensuring you get the best financing options available.
• Refining Your Search – Tailored insights to match your business needs and financial goals.
• Streamlining lender comparisons – Saving you time and money by quickly identifying the most suitable lenders.

With over 100 lenders on our platform and access to thousands of loan options, Brickflow empowers brokers to find and secure the best commercial mortgages in minutes, not weeks. Our technology eliminates the guesswork, ensuring faster approvals and better rates. In fact, brokers using Brickflow save an average of 20+ hours per deal, allowing them to focus on winning more clients and growing their business. Why waste time searching manually when the right deal is just a few clicks away?

Explore your mortgage options with Brickflow’s lender comparison tool today.

Final Thoughts: Secure the Best Commercial Mortgage Deal

Securing a commercial mortgage doesn’t have to be overwhelming. By preparing a strong business plan, ensuring financial stability, and comparing lenders, you can improve your chances of approval and secure the best terms.

Ready to take the next step? Explore commercial mortgage options with Brickflow today!

FAQs

Can anyone get a commercial mortgage?

Not everyone qualifies. Lenders require a strong financial history, a solid business plan, and a sufficient deposit.

How much do I need to put down for a commercial mortgage?

The exact deposit depends on the lender and property type, but expect at least 20% as a minimum requirement.