Many borrowers are interested in the question of where to get a mortgage for commercial real estate for individuals. Not all organizations provide it, but there are offers on the lending market.
It is important to understand that a limited number of people can take out a mortgage on commercial real estate. The law does not prohibit issuing loans for non-residential properties to any individual (in accordance with Article 5 of Federal Law No. 216-FZ of December 30, 2004). In practice, banks are ready to lend only to borrowers who are in one way or another connected with entrepreneurial activity:
- individual entrepreneurs;
- farm owners;
- shareholders, co-founders, directors, as well as top managers of Russian companies.
For information. Commercial real estate refers to premises (buildings) for doing business. This could be a warehouse, office, workshop, garage, etc. Such an object is more expensive than an apartment, and the security requirements are stricter.
Advice! When calculating a mortgage for commercial real estate online, do not look for offers on the Personal Loans tab. Most likely, the program you are interested in will be on the SME (small and medium-sized business) lending page.
Buying commercial real estate with a mortgage – why is it profitable?
Businessmen know how much money rent costs every month. And it tends to constantly increase. In addition, the owner of square meters can put the tenant out on the street at any time. Having your own premises is a guarantee of a calm future and a successful investment of personal funds.
A mortgage on commercial real estate for individual entrepreneurs does not prohibit renting it out or holding business events. Yes, you cannot sell it - it is pledged to the bank until it is fully repaid. But it is not prohibited to earn income in one form or another.
Mortgage scheme for commercial real estate for individuals
The loan issuance algorithm is similar to the residential lending scheme. But the conditions are much stricter. Mortgages on commercial real estate without a down payment are rare. Usually they require not only an advance (25–50%), but also security in addition to the usual collateral. The term of such loans does not exceed 10 years.
There is an intention to become the full owner of business premises - we act according to the following scheme:
- We are looking for a bank with loyal conditions.
- Let's submit an application.
- We collect documents.
- We carry out real estate assessments.
- We pay the down payment.
- We get a loan.
- We pay for the premises.
- We formalize ownership rights.
- We pledge the square meters to the bank until the loan is fully repaid.
Important! Not all types of enterprises can purchase premises using credit money. Typically, banks impose restrictions on activities such as gaming business, insurance and leasing, bookmaking, and trade in cigarettes and alcohol. It is also problematic for realtors, builders, and notaries to buy square meters through borrowed funds.
How to increase your chances of approval
An entrepreneur planning to receive a positive response to a mortgage request may find the following tips useful:
| Employment in your own company | Possibly if OSNO is used. With the simplified tax system or UTII there is no such possibility. Some banks are ready to lend to individual entrepreneurs on the same terms as employees. |
| Own accounting department | Having an internal accounting department with a simplified taxation system also increases your chances of success. |
| Do not advertise IP | If you have a stable paid job with sufficient income, you can not advertise your individual entrepreneur, but submit an application to the bank on a general basis as an individual. |
| Mortgage borrower | If you have a spouse for whom an individual entrepreneur is not registered, you can make him a mortgage borrower. |
| Take out a mortgage for a home and use it for business? | Theoretically, this is possible provided that other real estate is mortgaged, which is already the property of the individual entrepreneur. This option is worth keeping in mind - mortgage rates are much more favorable than business development loans. |
Mortgage for the purchase of commercial real estate by an individual - what documents are needed
It will take a long time to collect papers, and there are a lot of them. First of all, you will need personal documents:
- passport;
- certificates of marriage and birth of children;
- SNILS;
- taxpayer number;
- military ID;
- information about income and property owned.
As for the property, you will need its appraisal, purchase and sale agreement, and insurance. The premises must comply with the requirements of the laws of the Russian Federation for non-residential facilities. And, of course, not have any encumbrances (be under arrest, be the subject of a property dispute, be in disrepair, etc.).
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But that's not all. When an individual entrepreneur takes out a mortgage to purchase commercial real estate, he has to collect a full package of papers about his business:
- confirmation of registration (extract from the Register or Certificate);
- certificates from the Federal Tax Service confirming the absence of claims for payment of taxes;
- certificates of movement on accounts;
- license (if the field of activity is licensed);
- all official reports to state fiscal authorities for the last year.
The bank requires all these papers in order to clarify the financial history of the borrower. The lender needs to know about the financial obligations that the loanee has (unpaid mortgage, consumer loans, leasing, and so on). As well as about existing agreements with clients and business partners.
Note! When selling commercial property, an individual entrepreneur will pay an additional tax, since the tax authorities equate the proceeds from the sold premises to income from business activities.
List of documents
Usually this is a standard package, as well as additional papers related to the specifics of the activity.
There are two options:
- full package - passport, tax identification number, tax returns, activity reports, etc.;
- simplified package - in addition to the standard set, you will only need a certificate of business activity and tax returns.
The possibility of presenting a simplified package of documents depends on the type of bank and the taxation system of the entrepreneur.
How to calculate a commercial real estate mortgage
When purchasing a residential property, the borrower sees a loan calculator on the website. The program helps to calculate the actual payment amounts and see the payment schedule. When applying for a commercial property mortgage, the calculator is rarely loaded. Bankers believe that a businessman does not conclude a deal without lawyers and is able to calculate the costs on his own - without a special service.
In this case, you can use the calculator on our website (Online Mortgage Calculator). Since the calculation of loan parameters is, in fact, no different from an ordinary mortgage loan. You should open the Online calculator section for calculating a mortgage on the website, enter there the estimated cost of the premises, the amount of the advance, the term and the estimated percentage. The calculator will calculate, to the nearest penny, the monthly payment, the total overpayment, and also create a payment schedule.
Please note! Interest rates for using a loan are 3–5 points higher than for residential mortgages.
How to buy commercial real estate with a mortgage - step-by-step algorithm
Let's say the object is found. Are you ready to post bail? At what stage is the bank included in the scheme?
Let's consider two options for trilateral cooperation:
- A sales agreement is drawn up between the seller and the buyer. The borrower deposits part of the money in cash and provides a letter of guarantee from the bank for the remaining amount. After re-registration of ownership rights, the borrower pledges the building (premises) to the lender. The latter pays the money to the selling party.
- The buyer makes an advance payment and shows a letter of guarantee from the lender. After which the previous owner of the property pledges it to the bank. Then the purchase and sale agreement is signed. The new owner registers the premises in his name (with the consent of the bank).
The first scheme is simpler, but the seller has to wait for his money. This option does not suit everyone. Therefore, sometimes they choose the second path - more troublesome, but less burdensome for the seller.
Features of commercial real estate mortgages from close relatives
The bank meticulously analyzes documents if the subjects of the agreement are relatives (parents, children and grandchildren, grandparents, sisters and brothers, spouses). If the seller and buyer are related, it is better to warn about this immediately. If such a circumstance becomes clear later, the creditor may terminate the deal and demand the money back.
Attention! Settlements between relatives are considered riskier. After all, members of the same family can easily agree among themselves and use the bank for fraudulent purposes. Therefore, the check is carried out more meticulously and carefully.
Which banks can I get a mortgage for commercial real estate from: a brief overview
Commercial premises loans are considered riskier and therefore cost more. It is inappropriate to ask them from a bank with a small authorized capital. It is necessary to contact large financial institutions.
Mortgage programs for small and medium-sized businesses are active this year in:
- Sberbank (several offers at once);
- VTB;
- Rosselkhozbank;
- Uralsib Bank;
- Absolute Bank.
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Here they will help you buy commercial real estate with a mortgage for an individual in the status of an individual entrepreneur or the owner of a small enterprise. Let's take a closer look at lending programs.
For a large loan - go to Sberbank
Sberbank has a special Business Real Estate program. Main loan boundaries:
- rate from 11%;
- term – up to 10 years;
- advance payment – at least 25% (20% for agricultural producers);
- limit on annual revenue of individual entrepreneurs – 0.4 million rubles;
- the period of active activity of the enterprise is at least 6 months.
Note! The 11% rate is valid for a ten-year term and a loan amount of more than 5 million rubles. The limit on the amount is 200 million rubles (600 million in certain cities).
Security is required: pledge of the object itself and your own property, surety, insurance. The maximum age of an individual entrepreneur borrower (at the end of payments) is 70 years.
The second current program from Sberbank is called Express Mortgage:
- rate from 13.9%;
- time interval – up to 10 years;
- range of loans - from 0.3 to 7 million rubles (up to 10 million - selected cities);
- first payment – from 30% (25% – for certain categories of regular customers);
- surety is required;
- restrictions on annual revenue – up to 60 million rubles.
Important! Not all Sber branches are ready to accept and consider applications for a loan to an individual for the purchase of commercial real estate. Check their list on the official website of the institution.
Sberbank offers the following cooperation algorithm:
- face-to-face meeting with a specialist in one of the departments;
- filling out a form;
- preparation of documents (personal and reflecting the activities of the company/individual entrepreneur).
Having received approval, you can look for a suitable object.
Mortgage conditions for non-residential premises for individuals in Sberbank are among the most loyal. But the papers will have to be prepared carefully. In addition to personal documents, the bank will require:
- charter,
- tax return;
- financial and accounting statements for the last year;
- book of income and expenses;
- a certificate of property status and current obligations in a special form;
- certificates from third-party banks showing monthly turnover on current accounts;
- copies of all outstanding commercial contracts (with contractors, buyers, suppliers, customers).
Important! The list of papers of an individual entrepreneur on general tax, UTII, Unified Agricultural Tax and the simplified tax system is different. Private entrepreneurs with any form of taxation can apply for a loan from Sberbank by providing their financial documents.
Do VTB provide mortgages for commercial real estate?
VTB is also ready to lend to a borrower who wants to purchase a warehouse, office, non-residential building, etc. Conditions:
- rate – from 10%;
- term – up to 10 years;
- restrictions on the amount issued – 150 million rubles;
- advance payment – from 15%.
The package of papers is the same as in Sberbank. At the same time, VTB is ready to issue a loan one-time or divide it into several tranches. And also, if necessary, provide the debtor with a one-time deferment for the loan.
Important! With additional collateral, VTB is ready to lend at a zero rate.
Mortgage secured by purchased commercial real estate in Rosselkhozbank
RSB is ready to serve individual entrepreneurs on the following terms:
- loan duration – up to 8 years;
- advance – from 20%;
- loan – up to 200 million rubles;
- It is possible to defer payments for up to 12 months;
- availability of an open current account with Rosselkhozbank.
One of the advantages of lending in the RSB is the voluntary choice of payment scheme (annuity or differentiated) . There is also the possibility of a one-year deferment. Mortgage rates for commercial real estate are calculated individually.
How to apply online for a business loan at Rosselkhozbank
Getting to the questionnaire page is easy - it is visible immediately when you go to the credit products for small businesses tab.
First of all, you need to select from the drop-down list the branch in which you want to be served. Then enter the loan parameters (amount, period in months). Introduce your organization, give contacts for communication. And select the item that corresponds to your annual income (up to 120 million rubles, up to 800 million rubles or higher).
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Below you must note the purpose of obtaining a loan:
- for current goals;
- investment goals (the acquisition of business real estate falls into this category);
- refinancing.
Important! This bank has no restrictions on the annual turnover of the enterprise.
Is it possible to buy commercial real estate with a mortgage from Uralsib Bank
Another bank ready to lend to individuals with individual entrepreneur status is Uralsib. The corresponding program is called Business-Invest and is designed for businessmen who have been working for at least 6 months.
Main parameters:
- period for repayment of borrowed funds – from 1 to 10 years;
- advance – minimum 10%;
- maximum amount – 100 million rubles;
- revenue for 12 months – up to 800 million rubles;
- number of employees – up to 250 people;
- A guarantee and additional security are required.
Attention! There are registration fees: 1.2% (minimum 25 thousand rubles) for a loan up to 15 million and 0.6% (at least 105 thousand rubles) for a larger amount.
Commercial real estate mortgage for individuals at Absolut Bank
The loan is provided in the range from 5 to 15 years, the bank remuneration is from 13%. Moreover, you can fill out an online application and invite 4 co-borrowers. The last point is not at all superfluous, since premises for business processes usually cost much more than a residential building/apartment. The loan size is limited to an upper limit of 80% of the value of the property. In general, the bank agrees to lend from 1 to 15 million rubles.
The borrower must be a citizen of the Russian Federation under the age of 65. But registration does not matter. However, it is important to have a regular income in the region where the bank operates.
Important! Absolut Bank lends to solvent clients with entrepreneur status for at least 1 year. A guarantor(s) is required.
Possible reasons for bank refusal
The main reason why banks are reluctant to issue mortgage loans to entrepreneurs is the difficulty in assessing the real state of affairs of a businessman and doubts about the stability of his activities. And even the absence of delays in taxes, fees and previous loans does not reflect the actual solvency of the borrower.
And here, an important factor is the taxation system that the individual entrepreneur uses. If the general one (OSNO) is applied, then all income is visible, and it is easier for the bank to make a positive decision. But the so-called “simplified” approach, on the contrary, complicates the process. If an entrepreneur uses the simplified tax system “income - expenses”, the profitability of the activity can still be somehow assessed, but with the “income” system it is more difficult for the bank to see the financial results of the borrower, since the reports do not display the expenses of the individual entrepreneur, which can be very significant and “eat up” all the organization’s profits.
However, banking institutions are meeting the needs of small and medium-sized businesses, offering increasingly affordable mortgage conditions.
But there are a number of factors that, if they do not deprive an entrepreneur of the opportunity to get a mortgage, will certainly become a “stumbling block”:
- damaged CI or its complete absence;
- inexperience of the entrepreneur (activity less than 12 months);
- UTII as a taxation system;
- unstable income (in the case of working with seasonal goods and services);
- problems with accounting reporting, legislation and inspection bodies, the presence of fines;
- lack of property in ownership, deposits;
- the presence of a number of outstanding loans.
If the bank refuses your loan application, you need to find out the problems and try to resolve them. After some time, you can try your luck again in this bank or in another; contacting several banking organizations at once will increase the chances of success.
What products are other banking institutions ready to offer?
The list of banks lending to individual entrepreneurs under mortgage programs is quite small. If the above institutions fail, you can contact another organization. Almost all major players in the credit market have products for entrepreneurs, but without the word mortgage. Let's see what they offer:
- Alfa Bank;
- Promsvyazbank;
- Rosbank.
We will select those programs that allow you to borrow loans to replenish fixed assets. This includes the purchase of capital structures.
- Alfa Bank has a business loan program. Without collateral, it is possible to borrow from 300 thousand to 10 million rubles. Alpha even offers a differentiated payment schedule. True, the rates are rather high - from 14 to 17%.
- Promsvyazbank is ready to provide a loan for investment in development. Restrictions on the amount - from 3 to 250 million rubles, period - up to 10 years, rate from 9%.
- Rosbank has several programs. One of them is an Investment loan. Under this program, a company or individual entrepreneur can receive up to 100 million rubles for a period of up to 7 years at 11.88%. There is a six-month deferment for loan repayment.
Conditions for issuing a mortgage
You need to know about this! Read Inheritance under a will for an apartment
Usually they are as follows:
- down payment - 15-40% of the property value;
- the minimum amount for issue is 100 thousand rubles;
- interest rate - from 9.4% and above.
Both secondary housing and apartments in new buildings are available for purchase.
Sberbank, Akbars and Rosselkhozbank offer mortgage lending for this category using maternity capital. It goes towards making a down payment.
In addition, there are other requirements:
- Russian citizenship;
- age from 21 to 75 years (age restrictions vary in each bank);
- conducting business activity for at least 6 months.
Check the conditions for obtaining a mortgage with your bank.
conclusions
A commercial mortgage is the purchase of business premises with borrowed money. The law does not prohibit an individual without individual entrepreneur status from taking such a loan. But in fact, you need to be an entrepreneur or manager (co-founder) of a successful company. True, there is an option - to take out a non-targeted (non-mortgage) loan.
The most comfortable conditions for servicing individuals with individual entrepreneur status are available from Sberbank and VTB. Moreover, the latter institution provides a loan for the purchase of commercial real estate without a down payment. Less profitable ones are from Rosselkhozbank, Absolut Bank, Uralsib (additional commissions are provided here). Other institutions are ready to issue non-mortgage loans to businessmen for the purchase of fixed assets.
Have you been denied a mortgage loan? There is no reason to give up. If you have not passed strict banking monitoring, but want to have your own premises, there is a way out. You can take out a mortgage as an individual for a residential property - with the goal of then converting it to non-residential status (for example, an apartment on the ground floor). Also, some individual entrepreneurs are allowed to operate in residential premises.
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Author:
Mortgage specialist Maria Yurievna Sokhan
Publication dateSeptember 18, 2019September 18, 2019
Peculiarities
The main problems are the lack of stable income that officially registered individuals have. Even if the entrepreneur's income is high enough to receive a loan, there is no guarantee that the business will fail in the near future and its owner will be left without a livelihood.
In addition, this category of citizens cannot present a certificate of income in form 2-NDFL , which is included in the mandatory list of documents when using most mortgage programs. This is where the main problems lie. However, if you wish, you can convince specialists from a financial institution of your solvency.
Please note that if you present the full package of documents requested by the bank, you will be able to get a profitable loan for the purchase of not only residential, but also commercial real estate. In any case, you will have to apply for a mortgage as an individual, but with a special taxpayer status.
