Selling mortaged house to buy business premises

leefen

Is it possible to sell a mortgaged house to buy a mixed use property - a shop with flats over to start a business?

Thanx

davidmcn

You can sell your mortgaged house and do what you like with the proceeds. But do you mean you need a mortgage for your purchase?

AnotherJoe

Is your real question about buying commercial / mixed use premises ?
Then you will need some sort of business type loan or mortage.

Selling your existing house is not really relevant to that process it's your money you can do what you want with it once you've sold it.

lovinituk

You will need a commercial mortgage for a commercial property. For this you will most likely need to prove the business is viable. You will need at least 25% deposit.

I'm just in the process of buying a similar property for my business. The lender has agreed a 25% deposit. I have 3 years of strong accounts.

Not sure how easy it would be for a new business.

leefen

Thanks, everyone.

The consensus seems to be I would sell the house and buy mixed use commercial and residential no problem.

But would the outstanding mortgage now have to become a more expensive 'mixed use' or commercial one? - renegotiations and higher costs and possible outlay if my current provider is not the best option long-term?

davidmcn

leefen wrote: »

But would the outstanding mortgage

You wouldn't have an outstanding mortgage. You would have to redeem your existing mortgage account with the sale proceeds.

have to become a more expensive 'mixed use' or commercial one? - renegotiations and higher costs and possible outlay if my current provider is not the best option long-term?

As said, you would be looking for a commercial mortgage. Completely different market and criteria, undoubtedly more expensive than a residential mortgage.

lovinituk

Yes and yes.

Does your current lender even offer commercial mortgages?
What trading history do you have? What are your projected profits? Can you prove it?

We had to show that our business could easily cover 1.5 times the annual mortgage repayment.

If it's a brand new business without any history or accounts, I don't think you will get a commercial mortgage.

amnblog

A shop with 'flats' is very much a commercial deal and more complex that your current mortgage on your home.

Get yourself some good mortgage advice specific to the intended property before you do anything else.