Refinance of a Semi Commercial Property

Background

Our client owned a mixed-use property comprising both residential and commercial units. While the property was performing well, the existing mortgage carried a relatively high interest rate and limited flexibility. The client’s objective was twofold:

• Reduce monthly mortgage costs to improve cash flow.
• Release additional capital to fund further property investment projects.

The Challenge

Mixed-use properties often present financing challenges. Many lenders view them as higher risk compared to purely residential assets, which can result in:

• Higher interest rates.
• Limited refinancing options.
• Complex lending criteria.

The client needed a broker who could navigate these challenges, identify suitable lenders, and structure a deal that met both cost-saving and cash-release goals.

Our Approach

As the appointed broker, we undertook a comprehensive review of the client’s situation:

• Mortgage Audit: Assessed the current mortgage terms, repayment schedule, and interest rate.
• Market Research: Explored specialist lenders and mainstream banks offering competitive products for mixed-use properties.
• Cash Release Strategy: Calculated the equity available in the property and structured refinancing options to maximise capital release without over-leveraging.
• Risk Management: Ensured the new arrangement maintained sustainable repayment levels and aligned with the client’s long-term investment strategy.

The Solution

After negotiating with several lenders, we secured a refinancing package that delivered:

• Lower Interest Rate: Reduced the client’s monthly mortgage payments significantly.
• Cash Release Facility: Enabled the client to access additional funds tied up in the property’s equity.
• Flexible Terms: Provided repayment options that supported both current cash flow and future investment plans.

Outcome

The client achieved immediate savings on their mortgage costs, improving monthly profitability. More importantly, the released capital allowed them to pursue new property projects, expanding their portfolio and strengthening their investment position.