If a commercial mortgage payment has been missed, a shortfall is approaching or a formal notice has arrived, act before the position becomes harder to resolve. This guide explains what to confirm, what information a lender may need, when refinancing may be realistic and when legal, insolvency or independent debt advice is urgent.
Contact the existing lender early and present facts, not an unsupported promise
Confirm the payment, covenant, maturity or notice position from the actual loan documents and lender correspondence. Then prepare current cash flow, accounts, property information, the cause of the problem and a realistic proposal. A lender may discuss support or changes, but it is not obliged to agree them. Refinancing can be considered where a new loan is genuinely affordable and can complete in time.
Four actions that protect time and improve the quality of the conversation
The objective is not to produce a perfect rescue plan immediately. It is to establish the true position, preserve evidence and speak to the right people before avoidable delay reduces the available routes.
Read the lender communication
Record the overdue amount, dates, contact details, response deadline and any stated event of default. Keep the envelope, email and attachments. Do not rely on a verbal summary where the written notice says something different.
Contact the existing lender
Use the team or relationship contact shown by the lender. Explain the immediate facts honestly, ask what information is required and confirm how future payments and communications should be handled while the case is reviewed.
Build a short cash-flow view
Show the bank position, expected receipts, payroll, tax, suppliers, property costs and debt payments. A rolling 13-week forecast can reveal whether the mortgage problem is isolated or part of a wider cash-flow or solvency concern.
Choose the right professional route
A broker can assess refinance evidence. Your accountant can help with reliable figures. A solicitor should review demands and security documents. An insolvency practitioner should advise where the company may be unable to pay debts as they fall due.
Current business support pages from Lloyds Bank and NatWest both encourage business customers in financial difficulty to contact the bank or relationship manager. The options and process for your commercial mortgage will depend on your lender and agreement.
Commercial mortgage arrears and default are not one situation
A useful response starts by separating a forecast shortfall, missed payment, non-financial breach, expired facility and formal enforcement step. Each has a different urgency, evidence need and range of possible outcomes.
What information helps a lender assess a commercial mortgage problem?
The lender needs to understand what happened, whether the business or rent can support future payments, what protects its security and whether the proposed solution is credible.
Lloyds Bank’s business guidance on early warning signs says businesses should engage in open, honest and early communication and seek independent legal and financial advice. NatWest’s financial-difficulty guidance highlights the value of understanding the cash position and using a reliable 13-week forecast.
What might be discussed with the existing lender?
The available response depends on the agreement, arrears, cause, affordability, security, borrower conduct and lender decision. The examples below are conversation routes, not borrower rights or promises that a lender will agree.
Catch-up or payment arrangement
The lender may consider how normal payments and arrears could be addressed over an agreed period. The proposal needs to be affordable, documented and consistent with the wider cash-flow position.
Temporary variation or amendment
A lender may choose to discuss a term, payment or other contractual change. Any variation may involve conditions, fees, revised reporting or additional security and should be confirmed in writing.
Waiver or remedial plan
A covenant, reporting or consent breach may lead to a request for information, a time-bound action plan or a waiver. A one-off waiver does not necessarily remove the original obligation.
Equity or other cash injection
Shareholder funds, sale proceeds or other demonstrable cash may reduce arrears or debt. The source, timing, legal position and effect on other creditors need to be transparent.
Orderly property sale
Where the property or loan is no longer sustainable, a planned sale may be considered. Obtain valuation and legal advice, understand the redemption figure and do not assume the lender will pause action for an unproven sale.
Commercial mortgage refinance
A new lender may be possible if the case remains affordable and financeable. The arrears, default, cause, property value, deadline and exit from the existing lender will all form part of the new assessment.
The UK government’s Corporate Financial Distress Guidance Note explains that lenders are important stakeholders in a distressed company and may hold security over property and wider assets. It also describes formal rescue and insolvency routes. The guidance is written for government-contract management, but its explanation of financial distress and secured-lender influence is relevant background.
Can you refinance a commercial mortgage that is in arrears or default?
Potentially, but the new lender will not assess the case as if the arrears did not exist. The refinance must solve a defined problem without creating an unaffordable or incomplete exit.
A refinance may be more credible when
- The cause is identified and supported by evidence.
- Current trading income or rent can support the proposed repayments.
- The property value provides enough security after all costs and debts.
- The redemption figure, charges and completion deadline are known.
- Accounts, bank statements, leases and management information are available.
- Legal, title, planning, insurance and property issues can be resolved in time.
A refinance may be weak or too late when
- The borrower cannot maintain either the existing or proposed payment.
- Cash flow relies on unsupported sales, rent or value assumptions.
- Tax, payroll, supplier or other secured arrears are undisclosed or worsening.
- The property value is uncertain or insufficient after redemption and costs.
- A legal deadline is imminent and the required valuation or legal work has not started.
- The business may be insolvent and professional advice has not been obtained.
Read Count Ready’s separate commercial remortgaging page for the general refinance route and the commercial mortgage document checklist for the evidence a new lender may request.
When is a broker review not enough?
Commercial mortgage arrears can involve finance, contracts, property security, company duties and personal liability. These are separate areas of advice and should not be collapsed into one conversation.
Speak to the existing lender
Use the lender’s arrears, support, recoveries or relationship team to confirm its current position, required information, payment handling and decision process. Keep written records of what is agreed.
Ask a commercial mortgage broker
A broker can assess whether a refinance may be realistic, identify lender questions, sense-check the required amount and explain the mortgage application route. A broker cannot compel the existing or new lender to agree.
Obtain legal advice
Use a solicitor where you need advice on the facility, demand, charge, debenture, guarantee, enforcement step, court document, property sale, standstill or proposed variation. Do not allow a legal response date to expire while waiting for mortgage terms.
Obtain insolvency advice
Directors should consult an authorised insolvency practitioner where the company cannot or may soon be unable to pay debts as they fall due, liabilities may exceed assets or creditor action threatens continued trading.
Use your accountant or turnaround adviser
Reliable management information, cash-flow analysis, tax position and recovery assumptions can be essential. Ask for evidence that can be understood by the lender rather than an unexplained spreadsheet total.
Consider independent debt or complaint support
GOV.UK signposts free business debt support, including Business Debtline. An eligible small business or guarantor may also be able to complain to the Financial Ombudsman after first complaining to the financial firm.
Official and independent starting points include the Insolvency Service’s director duties upon insolvency guidance, GOV.UK’s business debt and continuity options and company health-check guidance, which signposts Business Debtline, together with the Financial Ombudsman’s small-business eligibility guidance. Eligibility, legal effect and the right course depend on the borrower and jurisdiction.
What can happen if a secured commercial debt is not resolved?
The lender’s rights depend on the facility and security documents, the type of borrower and the applicable UK law. The purpose of this overview is to show why delay is risky, not to predict what a lender will do.
Demand or accelerated repayment
A qualifying event of default can allow a lender to demand amounts due under the agreement. The document may also provide for default interest, costs, information requests or restrictions.
Enforcement of property security
A lender holding security over commercial property may have enforcement routes if the secured obligations are not met. The process, notices and court involvement depend on the documents and jurisdiction.
Receiver or administrator
Security documents and insolvency law can permit a receiver or administrator to be appointed in relevant circumstances. Control, trading and property decisions can then move away from the directors or owner.
Claim against a guarantor
If another person or company guaranteed the debt, the lender may consider the guarantee according to its wording and the wider recovery position. Guarantors should obtain independent legal advice.
Sale and shortfall risk
Sale proceeds may be applied to secured debt and costs. If the proceeds do not clear the amounts due, the remaining position can affect the borrower and any guarantor under the relevant documents.
Formal insolvency process
Administration, a company voluntary arrangement, liquidation or another process may become relevant where the company cannot meet its debts. Only an appropriately qualified adviser should recommend an insolvency route.
For general background, see GOV.UK guidance on administration and receivership and liquidation and insolvency filings. These sources do not replace advice on a particular mortgage, company or enforcement step.
Sources used for this commercial mortgage arrears and default guide
These sources support the guide’s early-contact, business-distress, complaint and professional-advice signposts. The facility documents, lender correspondence and case-specific legal or insolvency advice determine what applies.
- Lloyds Bank: financial worries support and NatWest: struggling financially — current lender examples encouraging early contact and explaining that support depends on the customer’s circumstances. They do not state what another lender must offer or suspend any contractual deadline.
- The Insolvency Service: director duties upon insolvency and its company health-check guidance — official starting points on cash-flow and balance-sheet insolvency indicators, changed director priorities and the need for qualified advice. They are general guidance rather than advice on a particular company.
- GOV.UK: business debt and continuity options and Business Debtline — routes to government information and free independent debt support. Eligibility, advice coverage and jurisdiction should be checked directly with the service.
- Financial Ombudsman Service: who can complain as a small business — current eligibility guidance. A borrower or guarantor should first use the financial firm’s complaint process and confirm that the complainant and dispute fall within the Ombudsman’s rules.
- HM Land Registry Practice Guide 36 — professional guidance for England and Wales on how administration and receivership affect registered titles. It does not explain every enforcement power or replace legal and insolvency advice.
- FCA Handbook PERG 4.4 — guidance on the regulated-mortgage perimeter. Property use, borrower type, security and the agreement matter, so regulatory protections should not be inferred from the words “commercial mortgage” alone.
Evidence and urgency boundary
The facility letter, mortgage conditions, charge, debenture, guarantee, variations, payment records, notices, court documents, current redemption figure and written lender position take priority. Count Ready can help organise mortgage information and explore refinance routes, but cannot stop a deadline, require lender forbearance, interpret legal documents, advise directors on insolvency duties or confirm that a complaint or finance application suspends lender rights.
How to use these sources: Lloyds and NatWest are lender-specific examples, not market-wide duties or promises. The Cabinet Office distress guidance concerns public-sector suppliers and contracting, while Insolvency Service pages give general official guidance rather than company-specific advice. Business Debtline support and Financial Ombudsman eligibility must be confirmed for the individual case. HM Land Registry Practice Guide 36 applies in England and Wales, and FCA PERG explains the regulatory perimeter rather than deciding a particular case. Your facility and security documents, notices, court papers, lender’s written position and case-specific legal or insolvency advice remain decisive.
Last reviewed: 22 July 2026. All 13 unique external evidence destinations used in this guide were checked on this date.
Tell us about the mortgage, arrears and deadline
Complete the applicant, contact, property, timing and protection questions shown in the form using outline information only. In the final details box, add the current lender, approximate balance, arrears or amount demanded, payment position, any written deadline and the refinance outcome you need. Do not upload documents at this stage. Count Ready can assess whether a commercial mortgage refinance may be realistic and what information a lender is likely to require. We do not provide legal, debt or insolvency advice and cannot suspend lender action.
Before you send: This form is for outline arrears, payment, deadline, property and refinance information, not document upload, debt advice, insolvency advice or a formal response to the existing lender. Submitting it does not stop a payment or legal deadline, freeze interest or costs, obtain forbearance, suspend enforcement, make a complaint, change director duties, release a guarantor or secure a refinance. Do not send passwords, security codes, original identity documents, bank statements, accounts, tax records, facility agreements, security documents, guarantees, notices, court papers, lender correspondence or other unrequested files. Count Ready will use the outline details to discuss the mortgage route and preparation questions; agree a secure transfer method before sharing documents. Contact the existing lender promptly, keep the instructed solicitor and insolvency practitioner responsible for legal and insolvency advice, and rely on written case-specific confirmation before acting.
Commercial mortgage arrears and default questions
Direct answers about missed payments, lender contact, refinancing, notices, guarantees and urgent professional advice.
What should I do if I cannot make a commercial mortgage payment?
Contact the existing lender or relationship manager as soon as possible, preferably before the payment date. Confirm the amount and timing of the shortfall, prepare current cash flow and explain the cause honestly. Ask what information the lender requires and obtain independent advice if the problem affects wider business debts or solvency.
What happens when a commercial mortgage goes into arrears?
The outcome depends on the agreement, lender, arrears, borrower and security. The lender may request information, discuss a payment proposal, apply contractual interest or charges, issue a notice, demand repayment or consider enforcement. Commercial mortgages do not all have the same regulatory protections, so check the documents and obtain advice on the actual position.
Can a commercial mortgage lender offer a payment arrangement?
A lender may choose to discuss a catch-up plan, temporary change or another support route, but it is not obliged to agree and the available options are case-specific. A useful proposal shows what can be paid now, how normal payments will be maintained, how the arrears arose and why the plan is affordable.
Can I refinance a commercial mortgage with arrears?
Potentially. A new lender will assess the reason for the arrears, current payment position, property value, income, accounts, credit profile, other debts, redemption amount and completion deadline. Refinancing is unlikely to solve the problem if the proposed new payment is unaffordable or the case cannot complete before an enforcement deadline.
Will commercial mortgage arrears affect my credit profile?
They can. The effect depends on the borrower, lender reporting, credit reference records and subsequent events such as defaults, court action or insolvency. Ask the lender how the account is reported and disclose the position accurately to any proposed new lender rather than assuming it will not be visible.
What is a commercial mortgage default notice?
The wording varies. It may identify a missed payment or another breach, reserve lender rights, require information, set a remedy deadline or demand repayment. Treat the actual document as important. Ask the lender to clarify its process and obtain prompt legal advice where the notice refers to enforcement, security, receivers, court action or immediate payment.
Can a lender pursue a commercial mortgage guarantor?
A guarantee can create liability if the obligations it covers are not met. Whether and when the lender can pursue a guarantor depends on the guarantee, facility, security and recovery process. A guarantor should obtain independent legal advice and should not assume that the property must always be sold before any demand can be made.
When do I need insolvency advice rather than only a mortgage broker?
Obtain insolvency advice if the company cannot or may soon be unable to pay debts as they fall due, liabilities may exceed assets, creditor pressure is escalating, a winding-up action has started or directors are unsure how their duties have changed. A mortgage broker can assess finance evidence but cannot advise on insolvency law or director duties.
Prepare the finance, property and personal-liability picture
These guides answer the questions that commonly sit alongside arrears, default and an urgent refinance review.
This page provides general information and is not legal, debt, tax, accounting, insolvency, valuation, insurance or mortgage advice. It does not suspend a deadline, prevent enforcement or promise that an existing or new lender will agree a proposal. Commercial loan and security documents are transaction-specific, and the law and process differ across the UK. Obtain advice from appropriately qualified professionals for your circumstances. Some commercial mortgages and business buy-to-let cases are not regulated by the Financial Conduct Authority; the position will be explained where relevant.