What Is the Loan-to-Value (LTV) Limit for UK Commercial Mortgages?

Ask a commercial mortgage lender how much they'll lend, and the answer almost always comes back as a percentage rather than a fixed figure. That percentage is the Loan-to-Value (LTV), the proportion of the property's value the lender is willing to fund, with the rest coming from your deposit.

Understanding where that limit typically sits, and what pushes it up or down, saves a lot of wasted time chasing deals that were never quite realistic to begin with.

Bank of England held base rate at 4.25% in June 2026 - waiting for inflation to cool.

73% of UK SMEs expect to grow in the next 12 months - confidence remains strong.

So, what's the typical Loan-to-Value (LTV) limit?

For most UK commercial mortgages, expect a Loan-to-Value limit somewhere between

65% and 75%. That means a deposit of roughly 25-35% is the realistic planning figure for the majority of straightforward commercial property purchases.

Some lenders will stretch to 80% Loan-to-Value for particularly strong applications, low risk property, an excellent tenant, a well-established business, a healthy deposit already in place elsewhere. Others will cap lending lower, at 60% or below, for property types or circumstances they consider higher risk.

There isn't one fixed number that applies to every deal. 65-75% is simply the sensible range to plan around.

Why don't commercial lenders go as high as residential mortgages?

Residential mortgages can sometimes reach 90% or even 95% Loan-to-Value, because the underlying asset, a standard house, is relatively easy to value consistently and resell if things go wrong.

Commercial property is a different animal. Values can be more volatile, specialist units can be harder to sell on to another occupier, and business income tends to be less predictable than a salary. The lower Loan-to-Value limit is the lender's way of building in a safety margin, so a dip in value or a temporary void doesn't leave them exposed.

• **What affects where your Loan-to-Value limit lands?**

• Several factors move the number up or down:

- Property type. Standard commercial property, offices, shops, industrial units, tends to attract the higher end of the range. Specialist assets like care homes, hotels, or petrol stations are often capped lower.

- Owner-occupier vs investment. Lenders sometimes treat these differently depending on their appetite.

- Tenant strength. A long lease with a strong covenant can support a higher Loan-toValue than an empty or short-let unit.

- Trading history. An established business with strong accounts is generally viewed as lower risk than a start-up.

- The DSCR (Debt Service Coverage Ratio). If the income comfortably covers the debt, lenders may be more comfortable lending a higher proportion of the value.

- Your experience. First-time commercial buyers are sometimes offered a lower Loan-to-Value than experienced investors with a track record.

Does a lower Loan-to-Value get you a better rate?

Generally, yes. A lower Loan-to-Value means less risk for the lender, and that usually translates into more competitive pricing. If you can comfortably put down more than the minimum required, it's worth asking what difference it makes to the rate you're offered. Often, it's a meaningful one.

Can you borrow above the typical limit?

Occasionally, through specialist lenders willing to stretch further, sometimes alongside additional security, a personal guarantee, or a slightly higher rate to reflect the extra risk. This isn't the norm, and it's not something to bank on without a conversation with a broker who knows which lenders are open to it.

What if you can't meet the deposit requirement?

A few options are worth exploring:

- Some lenders offer slightly higher Loan-to-Value limits for owner-occupiers compared with investment purchases

- Additional security, such as another property, can sometimes support a higher Loan-to-Value

- A strong DSCR or an excellent tenant covenant can occasionally offset a smaller deposit

- Bridging finance is sometimes used as an interim step, though it comes with its own considerations

The mistake people often make

Buyers sometimes assume the Loan-to-Value limit is a single fixed number across the whole market, then get caught out when a lender offers considerably less than expected for a specialist property type or a higher-risk deal. Checking the realistic Loan-to-Value for your specific property type, rather than the market average, avoids that surprise.

The bottom line

Budget for a Loan-to-Value limit of 65-75% on a UK commercial mortgage, treating anything higher as a pleasant exception rather than the default expectation. The exact

figure moves depending on the property type, the tenant, the business, and the borrower, but that range is where most realistic commercial mortgage conversations begin.

Disclosure: Money Pilot Ltd (FRN: 968705) is an Appointed Representative of Yellow Stone Finance Group Ltd which is authorised and regulated by the Financial Conduct Authority (FRN: 814533). Yellow Stone Finance Group Ltd is a credit broker not a lender. Money Pilot Ltd is Registered in England and Wales No: 13621432. You should always make sure you are able to afford any repayments as late or missed payments can affect your credit rating and access to future finance.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.