At Aria Finance, we pride ourselves on helping clients navigate complex borrowing scenarios. This case study showcases how we secured a semi-commercial mortgage for a client who needed to buy out a business partner while living above and trading from the same property. The case highlights our persistence, lender knowledge, and ability to simplify a challenging process for a client new to commercial mortgages.
The Client:
Our client owned a property comprising two commercial units with a flat above. They lived in the flat, ran their business from one of the commercial units, and rented out the second. Apart from one small buy-to-let property, the client had no prior mortgage experience as the property had originally been purchased outright in cash.
The Situation:
The client needed funds to pay off their business partner who had helped purchase the property. However, their partner would only come off the title once the mortgage was secured, adding a layer of complexity. In addition, the mixed-use nature of the property residential, commercial owner-occupier, and commercial investment - all on one title - narrowed the pool of potential lenders. Affordability was another challenge, requiring us to combine rental income from the commercial unit with trading profits from the client’s business.
Our Solution
We carefully assessed the client’s circumstances and identified a lender comfortable with the unique setup of the property. To ensure the client achieved the best possible outcome, we advised separating the share purchase transaction from the mortgage, allowing us to secure a more favourable rate and avoid restrictive lending criteria.
During the process, the initial valuation came in lower than expected, as it failed to account for the parking included with the property. By challenging this and presenting additional evidence, we successfully achieved an uplift in the valuation.
Affordability also required careful handling; we engaged in detailed discussions with the lender to explain a slight drop in the client’s business turnover and demonstrated how the combined rental and trading income supported the loan.
Throughout the journey, we made sure the client understood each stage by breaking down the complexities of a semi-commercial mortgage into clear, straightforward language, giving them the confidence to move forward.
Benefits & Results:
The client successfully secured a £468,000 semi-commercial mortgage at over a 25-year term, enabling them to pay off their business partner and take full ownership of the property.
The uplift in the valuation not only supported the borrowing requirement but also strengthened the overall case. Despite the challenges, the mortgage completed within three months, providing the client with both financial stability and clarity for the future.
Importantly, the client, who had been entirely new to commercial mortgages at the outset, felt supported and reassured throughout the process thanks to our persistence, expertise, and ability to communicate complex requirements in a clear and approachable way.
