Mixed Use mortgages

A mixed-use property mortgage is a specialist mortgage for properties that combine residential and commercial elements, such as shops with flats above, or offices with residential units. These mortgages consider both residential and commercial lending criteria.

Mixed-use finance is available for various combinations including retail with residential, offices with residential, industrial with residential, and other mixed-use configurations. The specific criteria and terms vary depending on the property type and use.

Mixed-use mortgages typically require deposits of 30-35% of the property value, though this can vary based on your experience, the property type, and the lender's criteria. Higher deposits may be required for new operators.

Lenders assess income from both residential and commercial elements, considering rental income, occupancy rates, and market conditions for each use. They'll want to see evidence of stable income from both elements.

Most lenders prefer borrowers with previous mixed-use property experience, though some may consider applications from those with relevant residential or commercial backgrounds and strong management teams.

Mixed-use properties must comply with regulations for both residential and commercial uses, including planning permission, health and safety requirements, and licensing. Lenders will assess your ability to meet these requirements.

Yes, though conversion projects may require higher deposits and more detailed planning. You'll need to demonstrate that the conversion meets all regulatory requirements and has appropriate facilities for both uses.

Lenders expect some variation in performance and typically require you to demonstrate sufficient reserves to cover mortgage payments during difficult periods. Some lenders may require 6 months' payments in reserve.

Some specialist lenders may consider mixed-use mortgages for borrowers with minor credit issues, though the criteria may be stricter. You'll typically need a larger deposit and may face higher rates.

Mixed-use properties require specialist insurance covering both residential and commercial elements, including buildings, contents, public liability, and business interruption insurance. The lender will specify the required insurance levels.