Semi-Commercial Mortgage

Secure an Interest-Only Commercial Mortgage Using Brickflow

• Instantly search live commercial mortgages from lenders across the UK
• Compare lenders' rates, fees and maximum LTVs
• Borrow between £25,000 - £60 million
• Check your deal stacks against actual borrowing costs
• Avoid wasting time chasing the wrong loan with our eligibility criteria filters
• Ultra-fast search process speeds up completion times

What is a Semi-Commercial Mortgage?

Unlike residential mortgages, which are solely for homes, or commercial mortgages, which apply to business premises, semi-commercial mortgages cover both. This makes them an ideal solution for property investors, business owners, and landlords seeking diverse income streams from a single property investment.

Semi-commercial investments can offer better financing options and higher, more secure returns compared to purely residential properties, making them a compelling choice in today’s market.

If you're looking to invest in a property that includes both living space and a business premises (like a shop with flats above) a semi-commercial mortgage offers the tailored financial product you need.

What is Semi-Commercial Property?

A semi-commercial property (also known as a mixed-use property) is a building that combines both residential and commercial elements. This could include, for example, a shop or office on the ground floor with flats above, or a building that houses a café alongside residential accommodation.

On high streets and in town centres, semi-commercial buildings are common. The upper floors are often used for residential or rental space, while the street level is occupied by retail or service establishments. For example:

• A hair salon with an apartment above
• A corner shop with a family flat on the upper floors
• A small office building that includes a residential flat

Because they offer dual income streams (one from residential tenants and another from commercial leases), semi-commercial properties can be an attractive investment. However, their dual-use nature also means that they fall into a unique financing category, requiring specialist lending products such as semi-commercial mortgages.

Benefits of a Semi-Commercial Mortgage

Investing in a semi-commercial property – and financing it with a semi-commercial mortgage – offers several unique advantages over purely residential or fully commercial investments.

1. Diversified Income Streams
One of the most compelling benefits is the ability to generate income from both residential and commercial tenants. This dual-income structure helps reduce risk, as it spreads exposure across different tenant types. If one unit becomes vacant, the other may continue to generate income, supporting your cash flow.

2. Higher Rental Yields
Semi-commercial properties often deliver stronger rental yields than residential investments alone. According to Shawbrook Bank, mixed-use properties can yield between 6–8% on average, compared to the typical 4–6% seen in many buy-to-let residential portfolios. The commercial component usually commands a higher rent per square foot, enhancing overall returns.

3. Potential for Lower Stamp Duty
In some cases, semi-commercial properties may benefit from lower stamp duty land tax (SDLT) rates compared to pure residential properties, particularly when the mixed-use designation applies. This can result in meaningful savings for investors at the point of purchase.

4. Greater Long-Term Value
Due to their mixed-use nature, semi-commercial properties may offer more value-added opportunities, such as converting or reconfiguring units to increase rental income or resale value. This can be particularly appealing to experienced landlords or developers seeking long-term growth.

5. More Resilient During Economic Shifts
Having both commercial and residential components can act as a hedge against market volatility. For example, in times of economic uncertainty, the residential units may continue to perform even if demand for the commercial space fluctuates.

Who Can Apply for a Semi-Commercial Mortgage? Eligibility & Criteria

Semi-commercial mortgages are available to a wide range of applicants, including individual investors, limited companies, partnerships, and experienced landlords. They’re commonly used by property investors seeking to diversify their portfolio, business owners looking to occupy the commercial unit while letting out the residential portion, or landlords aiming to maximise returns on mixed-use assets.

Loan-to-Value (LTV) and Deposit Requirements
Lenders typically offer semi-commercial mortgages up to 75% loan-to-value (LTV), although this can vary depending on the strength of the application. Borrowers should be prepared to contribute a deposit of at least 25%, though some may require more if the property is considered higher risk or the borrower’s financial profile is less established.

Income & Affordability Assessments
Applicants will need to demonstrate sufficient income to support the mortgage repayments. This might include personal income, projected rental income from both commercial and residential units, or existing portfolio income. Lenders will often take a stress-tested approach to ensure the property generates adequate income to cover the loan.

Eligibility Criteria
Approval is subject to a number of key factors:

• Credit history: A clean or strong credit profile is preferred, though some specialist lenders will consider adverse credit under the right circumstances.
• Property type: The nature of the semi-commercial property plays a big role in eligibility. Standard mixed-use assets like retail with flats above are generally favourable, while more unusual configurations may face tighter lending criteria.
• Experience: First-time landlords may face more scrutiny or be required to provide additional evidence of their ability to manage the asset, whereas seasoned investors or developers will typically be viewed more favourably.
• Business performance (if the applicant or a connected party occupies the commercial unit): Some lenders will review trading history and business accounts to gauge the strength of the enterprise.

Whether you’re applying as an individual or through a limited company, the right lender can make a big difference. Platforms like Brickflow help match your circumstances with lenders that best fit your profile, improving your chances of approval and securing the most competitive terms.

How to Apply for a Semi-Commercial Mortgage

Applying for a semi-commercial mortgage doesn’t have to be complex—especially when you have the right tools and support. At Brickflow, we make the process faster, more transparent, and more competitive by connecting you with specialist lenders and brokers who understand the nuances of mixed-use finance.

Here’s a step-by-step guide to get started:

1. Assess Your Requirements
Start by evaluating your project or property needs. Consider your budget, the type of semi-commercial property you’re financing, your desired loan amount, and repayment terms. Think about whether you're applying as an individual, through a company, or in partnership.

2. Use Brickflow to Explore Lenders
Visit Brickflow to compare semi-commercial mortgage options from a wide range of specialist lenders. Our marketplace gives you access to over 100 lenders and helps you instantly see who’s most likely to fund your project based on your criteria.

3. Work with a Brickflow-Powered Broker
Once you’ve found potential deals, we’ll connect you with a Brickflow-powered broker who can guide you through the next steps. These brokers are experts in semi-commercial finance and work closely with lenders to structure your application for the best chance of success.

4. Submit Your Application
Your broker will gather and submit the necessary documentation—this typically includes proof of income, details about the property, existing portfolios, credit reports, and financial forecasts if the commercial unit is owner-occupied.

5. Receive Terms and Progress to Offer
If your application is successful, the lender will issue terms. Once you accept, the process moves into valuation, legal checks, and underwriting. Your broker will help you manage this timeline and ensure everything stays on track.

6. Complete the Loan
Once legal due diligence is completed and all conditions are met, funds are released. You’re now ready to move forward with your investment or business plans.

With Brickflow, the entire journey is simpler, faster, and more tailored to your needs. Whether you're an experienced investor or just exploring semi-commercial opportunities, our platform gives you the power to find the right finance, backed by expert support every step of the way..

Semi-Commercial Mortgage Rates & Fees

Understanding the costs associated with a semi-commercial mortgage is key to making a well-informed financing decision. Rates and fees can vary widely depending on the lender, your financial profile, and the type of property you're purchasing or refinancing.

Interest Rates

Semi-commercial mortgage rates tend to sit between traditional residential and full commercial mortgages. As of early 2025, interest rates typically range from 5.5% to 9%, although this can change based on factors like:

• Loan-to-Value (LTV): Lower LTVs (e.g. under 65%) often secure more competitive rates.
• Borrower profile: Strong credit history, experienced investors, and healthy cash flow usually result in better terms.
• Property type and tenant mix: Prime locations with reliable, long-term tenants may attract lower interest rates.

Use a Brickflow-powered broker to help compare lender offers and negotiate the best terms based on your individual circumstances.

Arrangement Fees

Arrangement or lender fees are common and typically range from 1% to 2% of the loan amount. This is usually payable upon completion and can often be added to the loan.

Valuation & Legal Fees

Lenders will require a professional valuation of the property to assess its market value and suitability as security. Costs vary based on property size, complexity, and location. Legal fees will also apply, both from the lender’s solicitors and your own, and can range from £1,000 to £3,000+.

Broker Fees

If you’re working with a broker, there may be a separate broker fee, often around 1%, though this can vary depending on the complexity of the deal. The upside is that brokers often secure better terms, which can outweigh this initial cost.

Early Repayment Charges (ERCs)

Some semi-commercial mortgages come with ERCs, which are penalties for repaying the loan early. These usually taper off over the term of the loan and should always be reviewed before signing any agreement.

By comparing lenders through Brickflow’s specialist finance marketplace, you can access transparent quotes and avoid hidden fees—ensuring the deal you choose is the best fit for your project.

Is a Semi-Commercial Mortgage Right for You?

A semi-commercial mortgage can be a smart choice for investors and business owners seeking both capital growth and regular income. Compared to fully commercial mortgages, these loans may offer greater lender flexibility and better rates due to the residential component. Similarly, they tend to offer higher rental yields and stronger diversification than standard buy-to-let mortgages.

If you're looking to invest in a property that includes both living space and a business premises, like a shop with flats above, a semi-commercial mortgage offers the tailored financial product you need. 

Whether you’re investing for long-term income, planning a refurbishment, or running your business from part of the property, Brickflow gives you the tools to assess eligibility, compare lenders, and get the deal done—all in one place.

Conclusion 

Semi-commercial mortgages offer flexible, high-potential financing for mixed-use property investments. They combine the stability of residential rental income with the strong returns of commercial tenancy, providing diversification, resilience, and value-add potential.

But finding the right lender for these hybrid properties can be tricky without the right support.

That’s where Brickflow comes in. Our platform streamlines the process of finding and applying for semi-commercial mortgages by giving you real-time access to lenders who understand mixed-use finance. Compare rates, understand your eligibility, and connect with experienced brokers in minutes.

Whether you’re purchasing, refinancing, or developing, Brickflow ensures you can access the best deal for your needs, faster, easier, and with complete transparency.

Start your search today and find out how Brickflow can simplify your next property finance deal.