First time buyer - Commercial / Industrial Mortgage Help

[dreamwill]

Hello all, I am aiming to get a mortgage to buy a commercial property for business use because I'm tired of moving every 2-3 years. The property will be under my name, can't buy through company as there are others involved. Haven't done this before and have many specific questions I hope I can be guided in the right direction.


1) If my salary is sufficient for the monthly payments but isn't for the stress test, can I add a relative's salary proof in addition to mine as a guarantor?
2) It seems 2-3 months of salary proof is sufficient. What items can be omitted?: salary slips; bank deposit slips; bank statement?
3) Do you need to show proof that you have enough funds for the downpayment?
4) The building, an industrial one, is over 50 years old, anything to consider when buying something that old?
5) I may or may not pay off the whole mortgage early within a few years, but it seems some banks charge a premium to do so, is there a way to avoid paying that premium if I do?
6) Is it possible to get a mortgage without salary proof - say by using my relative's paid off property as collateral? or a combination?
7) Is it possible to be pre-approved for like "DBS DigiMortgage One-Minute Instant Approval" or "SCB Free Mortgage Preliminary Assessment Service" but then rejected for the actual mortgage?
8) When assessing salary proof do bank looks at the salary pre- or post-mpf ?
9) Is there enough time to try another bank if your first mortgage application gets rejected?
10) Is it possible to use company financials to get a mortgage with the property purchased 100% under my name?
11) Follow up on above Q, does it make a difference if the business I work for is 0% under my name or majority under my name and I'm just a director?
12) Up front I have to pay the downpayment, the stamp duty, agent's commission, and solicitors fees. Anything else I'm missing? Roughly how much would the solicitors fees cost?
13) Good idea to bypass the agent by directly dealing with the buyers or is that a big no no?

Keep note that these questions are regarding a non-residential property for which many rules differ from a home loan. Thanks.

[shri]

4) The building, an industrial one, is over 50 years old, anything to consider when buying something that old?

Banks might be very stingy in terms of the amount they offer for the mortgage - since it is an industrial building (few offer industrial building mortgages) and it is old.

7) Is it possible to be pre-approved for like "DBS DigiMortgage One-Minute Instant Approval" or "SCB Free Mortgage Preliminary Assessment Service" but then rejected for the actual mortgage?

These are residential mortgages and not commercial/industrial.

You need to approach your bank and ask very specifically for a mortgage for an industrial property. For pre-approval, they're going to need some specifics in terms of what building / unit you're looking at.

You should also be asking your agent for a list of banks that are willing / able to mortgage the property you're looking at.

13) Good idea to bypass the agent by directly dealing with the buyers or is that a big no no?

Not usually a big no-no, but given some of the questions you have, a helpful agent might be beneficial to your mental health (and a bad agent might leave you in worse mental and financial health).

A lot of your questions can only be answered by the banks that you have chosen as it is my experience that industrial/commercial mortgages are niche and not really available for small / old units from the mainstream banks.

Personal asset / guarantee based loans are indeed available, but you'd have to talk to the bank of the guarantor to see if they're willing to lend based on existing assets and more importantly the relationship with the bank.

[shri]

One more thing - Industrial properties have a specific land / building license which means that you technically cannot use the property as a "office". You need to have a warehouse / storage / workshop type operation in a industrial property.

There are ways around this - either through a license conversion (expensive) or throw up some shelves and "operate" as a warehouse or showroom / workshop etc. Again, this will factor into the mortgage / insurance costs etc.

[wilfhk]

for lawyers' fees, it's usually $10,000 or less