At Mortgage321, we pride ourselves on helping clients navigate challenging mortgage scenarios — the kind that don’t fit neatly into the boxes of traditional high-street lending.

Recently, we assisted a couple who owned a mixed-use investment property comprising a ground-floor commercial unit and a self-contained flat above. Their situation illustrates just how complex semi-commercial borrowing can be — and how experience, persistence, and the right lender relationships can make all the difference.

The Challenge

The clients originally financed their property through a semi-commercial mortgage that was approaching the end of its term. Their goals were twofold:

To repay the existing facility with their current lender, which had reverted to a high variable rate.
To raise additional funds to replenish savings used to refurbish the residential flat, which had recently been modernised to achieve market rent.

However, the process wasn’t straightforward. The case presented several challenges:

A vacant period while refurbishment works were carried out meant that rental income was temporarily reduced.
A mixed-use title (single freehold with both residential and commercial elements) limited the choice of lenders willing to consider the application.
The existing lender’s payment history appeared “irregular” on paper due to timing mismatches in rent receipts — although all payments had in fact been made within the month due.
A down valuation reduced the property’s assessed market value, impacting the available loan-to-value ratio.
Additional documentation and clarification were required around rental income declarations and taxation.

Our Approach

At Mortgage321, we know that no two specialist cases are the same. Rather than relying solely on mainstream sourcing systems, we conducted manual research across our panel of specialist lenders — speaking directly with underwriters and business development managers to understand their appetite for semi-commercial lending.

We identified Interbay Commercial as the most suitable lender based on their flexible underwriting, competitive 5-year fixed rate, and understanding of mixed-use property investment.

We worked closely with both the lender and the client’s accountant to address each stage of the underwriter’s queries. This included:

Providing a full explanation of the existing mortgage payment pattern.
Coordinating HMRC documentation to evidence rental income declarations.
Supplying property schedules, tenancy agreements, and confirmation of a new Energy Performance Certificate (EPC).
Supporting the client through the valuation process and liaising with the underwriter through several rounds of internal review.

The Outcome

After detailed assessment, the application was approved and a formal mortgage offer was issued. The new facility provided:

A competitive fixed rate for 5 years, protecting against further rate rises.
Capital raised to recover refurbishment costs.
A lending structure aligned with the client’s long-term investment goals.

Despite a lengthy and detailed underwriting process, the clients were able to secure a facility that reflected the true value and potential of their property — and now benefit from stable payments, improved rental income, and a refreshed investment asset.

Why It Matters

This case is a great example of what Mortgage321 does best — guiding clients through complex lending situations with clarity, persistence, and experience.

Semi-commercial mortgages often require more than just form-filling; they demand proactive communication, creative problem-solving, and an understanding of how different lenders interpret risk.

If you’re a property investor or business owner facing a similar challenge — perhaps a commercial mortgage renewal, refinancing need, or capital-raising project — our team at Mortgage321 can help you find a tailored solution.

Mortgage321 – Specialist Mortgage Advice for Complex Cases
📞 0800 612 8292 | ✉️ info@mortgage321.co.uk
Helping you turn complex property finance into clear, achievable outcomes.

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