Many commercial mortgage lenders do most of their business through mortgage brokers who act in their client’s interest to find the best deals. They can put pressure on lenders to keep interest rates down and introduce better terms and conditions.
One obvious area where borrowers benefit is when lenders reduce their interest rates. Some lenders who have decreased their rates have acknowledged that
this has been due to pressure from brokers.
Lenders want to make sure that the rents received by buy to let and commercial landlords will cover the commercial mortgage repayments. Some lenders have been persuaded by brokers to consider a landlord’s other income if rent levels are not high enough.
Portfolio landlords – those with four or more mortgaged properties – have been subject to stricture buy to let lending criteria. Not all lenders apply the same criteria when assessing loan applications. When brokers submit loan applications from portfolio landlords they were not clear whether the application would be successful or not. Lenders are now making their lending criteria clearer so that brokers know which applications have a good chance of approval.
Another change is the maximum loan period for interest only loans, which some lenders have increased to 30 years.
Most commercial mortgage brokers work with several lenders. Stiff competition from lenders could mean that any changes to interest rates and conditions could favour the borrower. With a wide range of commercial mortgage products available, mortgage brokers can match their client’s needs with the best mortgage deals.