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Owner-occupied

How do lenders determine when a property is owner-occupied? There are generally two broad considerations.

  1. When the owner of a property occupies 51% or more of the space, that property is called owner-occupied.
  2. If the business that rents the building is also owned by the company that owns the building, the property is also generally considered to be owner-occupied.

 

Let’s take an example from a real estate business. You are the owner of a real estate company. Your company buys a building. You set up your real estate business in that building. That’s owner-occupied. There are lots of variations on this theme. Most situations do qualify for some type of commercial loan. Here are some other situations where you might qualify for an owner-occupied commercial loan:

  • If you’re a business owner looking to purchase a commercial building for your business
  • If you’re a business owner and you want to buy the building that holds your business
  • If you plan to buy a building and occupy at least 51%, and lease the rent out to tenants

For an owner-occupied mortgage, the maximum mortgage amount is 75% to 80% of the appraised value of the property with approved credit.

For more information contact an OMJ Commercial Mortgage Specialist. To read more about office units and office buildings and the kinds of mortgages that might apply to your situation, check out our blog.

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