Can you get an interest-only mortgage on a commercial property?

Yes, it is possible to get an interest-only mortgage on a commercial property, but availability depends on the type of property, your business profile, and the lender’s criteria. With an interest-only structure, you only pay the interest on the loan each month, and the full loan amount (the capital) is repaid at the end of the term, usually through a sale, refinancing, or a structured exit plan. This can be a useful option for commercial mortgage business borrowers who want to maximise short-term cash flow or invest in properties with capital growth potential.

Interest-only terms are more commonly available on commercial business mortgage deals for investment properties, rather than owner-occupied ones. Lenders usually require a lower loan-to-value (LTV) often below 65% and a clear repayment strategy. If you’re buying a property with tenants in place, the strength of the lease and the tenant’s covenant will also influence the lender’s decision. The stronger the income stream, the more likely you are to secure favourable terms.

While it can be harder to access an interest-only commercial mortgage for start-up business cases, it’s not impossible. If you have strong personal assets, a solid business plan, or a clear exit route, some specialist lenders may consider a flexible interest-only option as part of a growth strategy.

To see what’s available and how much your repayments might look like, try our commercial business mortgage calculator or speak to one of our brokers for tailored advice. Interest-only commercial mortgages can be a smart solution in the right circumstances but they require careful planning and lender alignment.