Residential mortgage on commercial property

Baggins2030

Hi everyone,


My partner and I are trying to buy a house with 16 acres of land. The house will be our main and only residence. There is currently no business on the land or in the house.
Our plan is to later set a small glamping business up on the land.


We have been looking at residential mortgages for this purchase and have been accepted in principle (but on the basis of the site only being used residentially and not commercially)
If we take out a residential mortgage, will we still be ok to set a business up on the site going forwards? Or could our business insurance be invalid if the mortgage is for residential use only?


Thanks for your help! We're struggling to get god advice from a broker as they seem to only specialise in either residential or commercial mortgages and won't take a view on a site like this.


Thank you!!

davidmcn

Baggins2030 wrote: »

If we take out a residential mortgage, will we still be ok to set a business up on the site going forwards?

You would need your lender's consent. I would expect they'd be likely to say no, they won't want the complications/risk of commercial properties being part of their residential portfolio. So you'd then have to remortgage to a more appropriate product.

Or could our business insurance be invalid if the mortgage is for residential use only?

Your business insurance won't care what type of mortgage you have.