How Letter of Credit Functions?

What is letter of credit and how it works? How letter of credit functions? Typical scheme of activities associated with the letter of credit looks as follows:
1. Buyers and sellers sign the contract, which states that payment for the goods will take place in the form of a letter of credit.
2. The buyer asks his bank – the bank issuing the letter of credit – a request for a letter of credit in favor of the seller (beneficiary). Then bank accepts instructions of the buyer.
3. Issuing bank (in other words: opening) a letter of credit sends request to another bank (usually located in the country of the seller) for advising (transfer) of the content of the letter of credit, or for its validation...

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What is a Retail Property Mortgage?

Retail Property Mortgage is a loan to be used specifically for the purchase of a standalone retail unit, or other commercial premises used for conducting retail trade. In order to qualify for retail property finance the retail portion of the property must be greater than 40% of the total floor space. If the retail element is less than 40%, for example, by having rentable flats above the shop, the commercial mortgage application should be aimed at achieving an investment property mortgage, which has different qualification criteria.

Retail Mortgage Lending Conditions

Most commercial mortgage lenders will lend against retail property, and this position is unlikely to change significantly in coming months...

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International mortgage loan – how to get it?

International mortgage loan or better say international mortgage financing is not so tough to get as you might think. Many loan companies are able to source both commercial and residential mortgages in foreign countries, either directly, or through specialist local packagers. These special financial products are usually sourced “in-country” from premier lending sources such as High Street Banks and world-renowned institutions.

Remember th...

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What is a Mortgage Certificate?

What is a Mortgage Certificate? A Mortgage Certificate is a document provided by a Mortgage Intermediary or Lender, that gives an indication of the maximum amount a borrower can borrow by way of Mortgage Facilities. It is most widely used by people who are thinking about moving home or buying new property. The House Hunters Personal and Financial circumstances are taken into account and then applied to a standard Lending criteria. The Standard Mortgage Certificate is not issued with any one Lender in mind – but issued after taking into account average Lending criteria across the Mortgage Industry.

What ...

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Benefits of sale and leaseback explained

Benefits of sale and leaseback – what are those? Even those choosing to do a sale-leaseback to raise capital for a faltering business will find a buyer if the transaction is structured to all parties’ benefit.
RA sale-leasebacks are evaluated and packaged by the credit of the seller/lessee, by the type of property, and by the lease structure: Credit of lessee (tenant), National Credit-tenant, Regional tenant.

Benefits of Sale and Leaseback

Before entering into a sale-leaseback, the seller should compare his tax liability as owner with his projected tax liability as lessee. This calculation must include the tax consequences of the sale as well as comparison of deductions for rental payments as lessee with depreciation and interest deductions as owner...

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Owner occupied investment property – how to?

How to get industrial property mortgage loan or so called owner occupied investment property? Industrial property mortgage is a commercial loan to be used for the purchase or re-mortgage of a standalone warehouse unit, an engineering workshop, or any type of premises used for industrial business functions. Premises for this type of mortgage often fall into two categories: Owner Occupied Commercial Premises and Investment Property. Commercial mortgage lenders attach different conditions to each of these categories so we focus in this post on Owner Occupied Industrial Premises.

Owner Occupied Investment Property

To qualify for Owner occupied investment property mortgages the premises has to be used for an industrial purpose, such as manufacturing, engineering or warehousing...

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Mortgage requirements for investment property

What are mortgage requirements for investment property? What are buy to let lender options? Commercial property investments have been very stable and hold sustained growth in  industrial and retail sectors, and are considered to be safe investment. If you decide on a commercial investment property you need to assess carefully the availability of premises in the local area. Let’s start with residential investment mortgages as these are more common.

Residential Buy-to-Let Mortgages

These mortgages may be sourced from a wide variety of lenders of traditional residential mortgages, although, there is a hardcore of about 10 major BTL lenders who top the list in terms of interest rates charged, product flexibility, cost to arrange, and conditions of acceptance...

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Buy to let mortgage how does it work guide

Asking yourself – buy to let mortgage how does it work?  Buy-to-Let are investment property mortgages. The term describes properties that are bought on a buy-to-let (BTL) basis, where the property owner has no intention of living at the property, and is more interested in drawing an income either through rental profits or capital growth, over a short, medium, or long term period. Property investment is considered to be a safer investment than equities as it has a long track record of strong growth and to be a safer investment option.

Summary Residential and Commercial BTL Mortgages
Residential Commercial
LTV to 90% to 85%
Fees £ fixed % of the loan
Rental Income assessed Y Y

Suitable Property For Investment Property Mortgages

The term investment property is applicable to both the resid...

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Do self cert mortgages still exist ?

If  you ask yourself – do self cert mortgages still exist – look for the answer at the end of this post. Let us explain you first what are self cert mortgages. Self-Certified Commercial Mortgages are commercial mortgage loans issued by a lender requiring limited proof of income or business accounts. The process of obtaining a non-status self-cert loan is significantly simpler than status-based commercial mortgage loans that are offered by High Street lenders. This makes the process of obtaining the money faster, involving significantly less investment in time than when securing a status-based mortgage loan.

The Self-Certified Mortgage Application Process

Bridging_LoanThe applicant completes a commercial mortgage application form and signs the contract stating that they can afford to make the month...

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Commercial mortgage interest rates

What are commercial mortgage interest rates? Commercial development loans are used to enable a property developer to secure land and/or buildings and develop a site for sale or renting. In some cases the specialist lender will require the developer to produce a “Property CV”. This will have to show details such as his/her experience with similar projects and their property portfolio. Often a short business justification is required which should describe the reasons for wanting to purchase the site, and the intended development activity. There are several financial products that can be used to support such projects, each having their own advantages and disadvantages.

Commercial mortgage lenders base their lending decisions on many factors. The main factors are:

Industry Sector
Loan ...

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