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• You will not have to be concerned about not being able to renew a lease, or significant rises in rental charges. The rate you pay on your business mortgage will usually fall within a certain range (dependant on the Bank of England base rate), giving you a better idea of the long-term costs of the business allowing you to plan for the future.



• The capital of the business will increase with rises in the property market, as the premises will be a large asset for the business.



• You may be able to generate extra revenue for the business by sub-letting spare space to other businesses, however you should check with the mortgage provider before doing so as there may be a clause in the mortgage with regards to such actions.



• The monthly repayment amounts on a mortgage will usually be in the same kind of range as rental payments would be, so the costs will not be significantly higher and you will be adding to your business’ assets.



• The interest payments on a business mortgage are tax deductible.

As with most things is business, there are drawbacks that must be considered and weighed up against these advantages to determine if this is the right course of action for your business. The main disadvantages of a business mortgage and premises ownership are:

• A large investment will need to be made initially in the form of the deposit, and while this will actually go into the business as the property capital, you may have been able to invest this money in better ways for the business.



• Maintenance of the premises will become your responsibility, this can represent significant costs depending on the building, and so you need to be sure of the amounts in question before making any decisions.



• Relocating the business will take more time and effort, as you will need to see the property instead of simply cancelling a rental agreement or finding tenants to take it over from you.



• Your business will be exposed to changes in interest rates as these will affect your mortgage repayments.