Commercial Mortgage - reality check

waveneygnome

Question for the brokers out there.

I am looking to buy a commercial premises for my own occupation.

I have 35% deposit. My existing BIG 4 bank has offered me terms of:
15yrs (my term request)
Repayment basis (my request)
2.8% above base rate = 3.3% (variable)
1.5% arr fee

Does this sound a reasonable/fair deal? I tried to negotiate the arr fee, but was told 'its non-negotiable!' Which I was a little surprised about...thought they would come down a bit. But as I have nothing else to compare it to I'm not sure if it is ME who is being unreasonable!

I don't know any brokers (live in small rural village), otherwise I would be asking them.

dimbo61

Having recently paid 2% arrangement fee on a 75% BTL on a property which is fixed at a higher rate than you are being offered ( I understand it is variable )
Are you going to Live in the property or use as a business premises ?

waveneygnome

Its a business premises - light industrial use.

Thrugelmir

Lender has to earn it's fees somehow. You've a low interest rate to compensate the upfront fees.

waveneygnome

Thanks Thrugelmir.

I appreciate the lender has to earn something...but the rate of 3.3% includes a 1% reduction due to the Govts funding for lending program.

GMS

Lloyds by any chance?

waveneygnome

Nnnnnnnnneigh................neigh!

GMS

Try a broker. May be able to get a better deal. Though 1.5% isn't out of the ordinary by any stretch the amount of loan dictates the pain!

amnblog

The rate suggests you are a good prospect and may make a saving elsewhere but do you really need that distraction to shave a little off of the fee?

Let_Us_See

It's a good 'High Street' rate and the 1.50% arrangement fee is normal (but often higher).

waveneygnome

Thanks for all the replies.

I have tried a broker this morning and gave all the details/and what I've been offered already.

He was decent enough to call back an hour later to say he couldn't beat it, and pretty much the same as you guys....it's a good rate, just cough up the arr fee and be thankful.

Thanks again.