Paragon Commercial Mortgages Review

Paragon Commercial Mortgages at a Glance

Our Verdict

Paragon Bank suits professional landlords who borrow through a broker, especially those with HMOs, multi-unit freehold blocks, limited company SPVs or four or more mortgaged properties. It is not the lender for a trading business buying its own premises, because Paragon does very little commercial mortgage lending outside investment property. The bank built its reputation on buy-to-let, and the harder-to-place property types are where it earns a place on a landlord’s shortlist.

The 2025 move to 80% LTV on standard buy-to-let, paired with the rate cuts at 70% and 75% LTV and the discounted Green Mortgage range, has put Paragon back in front on leverage for portfolio landlords. The Interest Coverage Ratio stress test sits at 5.00% on products priced below 5%, so the rent a property earns sets how much you can borrow. Where Paragon falls down is genuine commercial: pure offices, retail parades, semi-commercial with awkward tenant mixes. For that work, Shawbrook usually outpoints them. As a specialist residential investment lender accessed through a broker, though, Paragon is hard to beat in 2026.

Best For

First-time landlords buying standard single-let residential property, portfolio landlords with four or more mortgaged properties, limited company SPVs, HMO and MUFB investors, and landlords with EPC A–C stock who want to lock in a discounted Green Mortgage rate. It also suits investors who want to push leverage to 75–80% on standard single-let properties without dropping into bridging.

Not Ideal For

Owner-occupier commercial buyers (a baker buying their own shop, for example), pure commercial assets like offices or retail units, semi-commercial buildings with complex use mixes, landlords seeking only the cheapest headline rate on a single standard property without comparing total cost, and anyone who needs an in-branch face-to-face relationship rather than a broker-led journey.

Key Facts

• Lender type: FTSE 250 specialist bank, intermediary-led, FCA-regulated (FRN 604551).
• Maximum LTV: Up to 80% on Single Self-Contained buy-to-let (raised from 75% in April 2025).
• Headline rates: 75% LTV 2-year fixes from 3.40% and 5-year fixes from 4.80% on EPC A to C property, with a 5% product fee (September 2026); the 80% LTV fixes launched at 6.14% with no product fee in April 2025, the latest 80% rate we found.
• Application fee: none on single self-contained property in the September 2026 core range, with free valuations across the core range.
• ICR stress test: 5.00% on products priced below 5%, and the initial rate above that.
• Trustpilot: 4.7 / 5 “Excellent” from over 11,500 reviews (bank-wide; verified October 2026).
• Access: Almost exclusively through commercial mortgage brokers.

What Are Paragon Commercial Mortgages?

How Paragon Commercial Mortgages Work

Paragon Bank is part of the FTSE 250-listed Paragon Banking Group, which has been lending in the UK property market since 1985 and has held a full UK banking licence since 2014. Its commercial mortgage business sits inside the wider Paragon Bank PLC and shares the group’s £12bn-plus balance sheet, which matters because it gives the lender the funding capacity to underwrite landlords with significant existing portfolios rather than capping out at a couple of properties.

In practice, what Paragon calls a commercial mortgage is overwhelmingly a buy-to-let mortgage written on commercial terms: that is, a mortgage on income-producing residential property held for investment, often inside a limited company structure. The bank does very little owner-occupier commercial lending and is not the natural home for someone buying a pub, a warehouse or their own retail unit. It is a property investment lender, not a trading-business lender, and that distinction shapes everything from underwriting to fee structure.

Paragon’s underwriting model is broker-led and specialist. Cases are submitted by approved commercial mortgage intermediaries and assessed by named underwriters who manually read the portfolio, the rental schedule, the tenant profile and the EPC band. Stress testing is calculated at a 5.00% Interest Coverage Ratio on products priced below 5% (and at the initial rate on products priced above it, Paragon’s rule since January 2024), so the rent a property earns sets how much you can borrow against it.

Main Mortgage Options

The Paragon range is built around the professional private rented sector and breaks down into a handful of distinct product families:

• Specialist buy-to-let on standard properties: Mortgages on Single Self-Contained (SSC) houses and flats, available in personal names or limited company SPVs, with leverage up to 80% LTV.
• HMO and MUFB mortgages: The core of Paragon’s specialist business: mortgages on Houses in Multiple Occupation and Multi-Unit Freehold Blocks, where rooms or flats are let separately and rental yields are higher but high street lenders will often refuse the property type altogether.
• Limited company and SPV lending: Mortgages structured for SPV limited companies and LLPs, the standard ownership vehicle for portfolio landlords from a tax perspective.
• Green Mortgages: A discounted rate range for properties with an EPC rating of A to C, designed both as a green incentive and as a way of rewarding landlords who have already upgraded their stock.
• Portfolio landlord facilities: Bespoke arrangements for landlords with four or more mortgaged properties, including refinances of existing portfolios and capital raise for further acquisitions.

Intermediaries can browse Paragon’s full buy-to-let product range on their online portal before submitting a DIP.

Pure commercial property (offices, retail, industrial) sits outside Paragon’s mainstream lending box. Brokers will sometimes get a semi-commercial case across the line on a special, but for true commercial assets you are normally pointed towards Shawbrook, Allica, OakNorth or InterBay.

Paragon Commercial Mortgage Rates and Fees

Interest Rates and Representative Costs

Paragon prices in tiers based on LTV, product fee, term length and EPC band. The published headline points from the April 2025 launch of the 80% tier and the September 2026 repricing look like this:

• 80% LTV (2- and 5-year fixed): launched at 6.14% in April 2025, the latest 80% rate we found, with no product fee, on Single Self-Contained property rated EPC A to C.
• 75% LTV core range (September 2026): 2-year fixes from 3.40% and 5-year fixes from 4.80%, paired with a 5% product fee and £500 or £1,000 cashback.
• Green Mortgage discount: small additional reduction on properties with an EPC rating of A to C, applied within the standard product range (3.40% against 3.45% for EPC D to E on the 2-year fix, September 2026).

The headline 3.40% rate is real, but it is bought rather than given: you are effectively pre-paying interest by capitalising a 5% product fee onto the loan in exchange for a lower coupon. On a £500,000 facility that is £25,000 of fee. For long holds with a 5-year fix it can pay back; for landlords who plan to refinance again at the end of a 2-year fix it often does not. The right way to read Paragon’s pricing is on a true cost-over-term basis rather than headline rate alone, and a good commercial mortgage broker will model both the percentage-fee and the nil-fee version of the same product before recommending one.

Fees and Charges

The cost stack on a Paragon commercial mortgage typically includes:

• Application fee: none on single self-contained property in the September 2026 core range; in 2025 most products carried a £299 application fee.
• Product fee: either nil (with a higher rate) or a percentage of the loan amount (with a lower rate). The September 2026 core range carries a 5% fee with £500 cashback on 2-year fixes and £1,000 on 5-year fixes.
• Valuation fee: free across the September 2026 core range. We found no published valuation terms for the HMO and MUFB ranges.
• Legal fees: paid to your conveyancer; Paragon’s legal costs are usually borne by the borrower.
• Early Repayment Charges: apply during the fixed-rate period on a tapered scale: typical of specialist BTL.
• Telegraphic transfer / completion fees: a small charge at drawdown.

The product-fee design is the part borrowers most often misread. A 5% fee on a £1m loan is £50,000 capitalised onto the balance: not a small number. Paragon’s breadth of fee options is genuinely useful but only if you actually run the maths.

What Affects Your Rate

The biggest single driver is LTV: the difference between a 60% deal and an 80% deal at Paragon is significant. After that, EPC band matters: properties rated A to C unlock the Green Mortgage discount and qualify for the new 80% LTV tier, while D–E stock is held back to lower LTV bands. Property type is the next lever: a vanilla SSC flat prices keenest, an HMO sits a notch higher, an MUFB or larger HMO higher again. Borrower structure (personal name vs SPV limited company) affects pricing only marginally these days, but portfolio size, ICR cover and personal credit record all feed in.

Paragon Commercial Mortgage Eligibility

Who Can Apply for a Paragon Commercial Mortgage

Paragon lends across the landlord spectrum, from new entrants to large portfolio operators. The bank explicitly targets first-time landlords on standard single-let residential properties, as well as the portfolio landlords (defined by the PRA as individuals or companies with four or more mortgaged buy-to-let properties), that make up the core of its business. Applications are accepted from UK residents, expats in some cases, and limited company SPVs and LLPs set up for the purpose of holding rental property. For HMO and MUFB applications, Paragon typically expects relevant letting experience; first-time HMO operators are a harder case to get across the line.

Trading History, Turnover and Credit Checks

Because the lending is property-investment driven, “trading history” really means landlord history. Paragon will want a complete schedule of existing rental properties, current mortgage balances, monthly rents and any consents to let. Personal income outside rental is taken into account but is not the primary affordability driver: rental yield against the 5.00% ICR stress is what determines headroom. Credit checks are done at the personal level on directors and shareholders of any SPV; missed mortgage payments, recent CCJs or undischarged defaults are real obstacles, though older minor blips are often workable with explanation. Paragon publishes an affordability calculator on their intermediary hub, which lets brokers model borrowing capacity before submitting a DIP.

Security and Personal Guarantees

The mortgage itself is secured by a first legal charge over the property being financed. For limited company SPVs, Paragon will normally require a personal guarantee from each director or significant shareholder: this is industry standard for SPV BTL lending and not specific to Paragon. The PG is usually capped at the loan amount and supported by a debenture in some cases. Borrowers should treat the PG as a real liability, not a formality: in a default scenario where the property sells short, the bank can pursue the directors personally for the shortfall.

Paragon Commercial Mortgage Application Process

How to Apply for a Paragon Commercial Mortgage

You apply through a commercial mortgage broker. Paragon is an intermediary-led lender by design and does not run a meaningful direct-to-consumer commercial mortgage channel. The broker submits a Decision in Principle (DIP) using the bank’s online portal, and a named Paragon Business Development Manager will normally pick up complex cases at that point. Once a DIP is issued, the broker prepares a full application pack and submits it for manual underwriting.

Documents and Checks Needed

Standard documentation for a Paragon application typically includes:

• Three months of personal and SPV bank statements.
• The last two years of personal tax computations (SA302s) and tax year overviews, or limited company accounts if applying through an SPV.
• Existing portfolio schedule, with property addresses, valuations, mortgage balances, lenders and rents.
• AST tenancy agreements for current and proposed properties, plus any HMO licences where applicable.
• Property valuation report (commissioned by Paragon) and EPC certificate for the property being financed.
• Proof of deposit and source of funds, with full AML and KYC checks on every director and significant shareholder.

Limited company SPV applications also need the Memorandum and Articles, certificate of incorporation and a clean Companies House record. Paragon’s underwriters read these properly: trying to slip a slightly-too-large HMO past as a standard let, or fudging a tenancy structure, is the fastest way to lose a case at offer stage.

Approval and Funding Times

For a clean SSC application, Paragon’s online broker platform returns a Decision in Principle, with the documents it asks for tailored to the case. From there, expect a formal mortgage offer within roughly 3–6 weeks of full submission and completion within 8–12 weeks overall: broadly in line with the rest of the specialist BTL market. HMOs, MUFBs and portfolio refinances typically run longer because each property needs an individual valuation and the portfolio stress test takes time. Paragon is not the fastest specialist lender on simple cases (OakNorth and Allica can move quicker on some commercial deals), but it is consistent and rarely renegs on agreed terms once an offer is issued.

Paragon Commercial Mortgage Repayments, Flexibility and Risk

Repayment Terms and Flexibility

Paragon’s commercial mortgages are typically structured on an interest-only basis, which is the standard for buy-to-let, with capital repayment at the end of the term funded by sale or refinance. Capital and interest options exist for borrowers who want to amortise. Fixed-rate deals are usually 2 or 5 years, with discounted variable rates also available; the wider mortgage term commonly runs to 25 or 30 years.

Overpayments are usually permitted up to a stated annual percentage of the balance (often 10%) without triggering an Early Repayment Charge. Once you go beyond that, or repay the loan during the fixed-rate period, ERCs apply on a tapered scale. Product transfers at the end of a fixed-rate period are available for existing customers and let landlords switch to a new Paragon product without re-underwriting from scratch, which is useful when interest rates are moving.

Missed Payments and Default Risk

Buy-to-let and commercial mortgages do not enjoy the same FCA forbearance rules as regulated owner-occupier mortgages, which means the bar for action is lower. A first missed payment will trigger a fee and a contact from Paragon’s servicing team; sustained arrears can result in a Law of Property Act Receiver being appointed to take over rent collection, and ultimately repossession and forced sale. Personal guarantees on SPV loans are enforceable, so directors should not assume the company structure ring-fences them in a default scenario. The practical advice is the same as with any specialist BTL lender: build a genuine cash buffer for void periods and rate shocks, and engage Paragon early if a problem develops: the bank’s servicing team has a reasonable reputation for working with borrowers who communicate, and a poor one for those who go quiet.

Paragon Commercial Mortgage Customer Reviews

What Customers Like

Paragon Bank’s overall Trustpilot score sits at 4.7 out of 5 (“Excellent”) from more than 11,500 reviews: verified October 2026. The review base is dominated by retail savings customers, but the consistent themes (clear digital systems, prompt processing, professional phone support) carry across to the lending side as well. Brokers who place regular volume with Paragon generally praise the underwriting team for being commercial, contactable and willing to engage on the detail of a portfolio rather than hiding behind a credit score.

For mortgage-specific sentiment, Smart Money People rates Paragon’s mortgage product at 3.07 out of 5 from eight reviews (October 2026): a much smaller pool, but drawn from borrowers rather than savers. The sample is too thin to carry significant weight, but it provides a useful counterpoint to the bank-wide Trustpilot figure. Independent intermediary feedback suggests that most mortgage-customer frustration centres on pace and documentation volume in complex portfolio cases, not on underwriting quality or post-offer conduct.

Common Complaints

Where Paragon attracts criticism, it is mostly about pace and paperwork. Complex portfolio cases can take longer than borrowers expect, and the documentation requirement is heavy: understandable given the underwriting depth, but a real time cost on a six- or ten-property refinance. The product-fee structure also catches out less experienced landlords who chase the headline rate without modelling the true cost of capitalising a 3% or 5% fee. And as a broker-only lender, anyone who would prefer to deal directly with a bank manager will find the model frustrating. None of these are deal-breakers; all of them argue for going in through an experienced specialist broker.

Paragon Commercial Mortgage Support and Regulation

Customer Support

Once the mortgage completes, day-to-day servicing is handled by Paragon’s UK contact centres with phone and secure-message support during business hours and a self-service online account for statements, balances and product transfer requests. New business support during the application is largely owned by the broker and Paragon’s regional Business Development Managers, who in practice are the most useful single point of contact when a case hits a wrinkle. There is no high-street branch network: Paragon is a digital, intermediary-led bank and runs accordingly.

Regulatory Status and Complaints

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the PRA, with FCA Firm Reference Number 604551. Eligible deposits are protected by the Financial Services Compensation Scheme up to £120,000 per depositor, although that protection covers savers rather than borrowers. Complaints are handled first by Paragon’s internal complaints team; unresolved complaints from eligible borrowers can be escalated to the Financial Ombudsman Service, though most commercial buy-to-let lending falls outside the scope of FCA mortgage regulation and the FOS’s remit is correspondingly narrower for limited company landlord cases. The bank is part of the FTSE 250-listed Paragon Banking Group PLC, which publishes audited annual accounts and regular market updates.

Paragon Commercial Mortgages vs Alternatives

Paragon vs Shawbrook Commercial Mortgages

Shawbrook and Paragon are the two most common names on a commercial mortgage broker’s shortlist for portfolio landlords, and they sit in slightly different lanes. Paragon is the volume player on residential investment property (SSC, HMO and MUFB), and it normally wins on rate and LTV for those asset classes, particularly with the 80% LTV tier on standard buy-to-let. Shawbrook is the better choice for genuinely commercial and semi-commercial property (serviced offices, mixed-use parades, holiday lets, hospitality) where the underwriting is more idiosyncratic and a manually-priced deal beats a product range. For a 12-property HMO refinance, default to Paragon. For a serviced-office freehold with three commercial tenants and a flat above, Shawbrook will normally do a better job.

Paragon vs InterBay Commercial Mortgages

InterBay (part of OneSavings Bank) overlaps with Paragon on HMOs, MUFBs and complex BTL but tends to play higher up the loan-size and complexity curve. InterBay will look at semi-commercial mixed-use property more readily than Paragon and is often the right answer for larger portfolio refinances above £1m where the case calls for a more bespoke structure. Paragon is normally cheaper and faster on standard SSC and straightforward HMOs, particularly in the EPC A–C range. The two banks are direct competitors and brokers will frequently price both before deciding which to submit.

Paragon vs Alternative Commercial Mortgage Lenders

For pure commercial property (owner-occupier or trading premises), HSBC, Lloyds and NatWest will normally outprice Paragon if the business meets their tighter criteria, while Allica and OakNorth offer faster digital underwriting on commercial deals up to around £5m. For development finance, Paragon runs a separate development finance division that handles residential schemes from a few million pounds upwards, worth approaching directly for mid-sized residential development. For more complex or large-scale projects where specialist structuring is needed, dedicated development lenders such as Hampshire Trust, Octopus Real Estate and Maslow Capital offer deeper product range. And for landlords who simply want the cheapest standard BTL on a single property, the high street BTL lenders (The Mortgage Works, BM Solutions, Accord) will almost always undercut Paragon on rate. The pattern is consistent: Paragon’s edge is the underwriting and structuring of professional landlord debt, not raw price on a vanilla single-let.

Final Verdict: Are Paragon Commercial Mortgages Worth It?

For the right borrower, yes: comfortably. Paragon is a leading specialist lender for portfolio landlords, HMO and MUFB investors, limited company SPV borrowers and landlords with energy-efficient stock who want to take advantage of the Green Mortgage range. The 80% LTV tier, the 5.00% ICR stress and the broker-led manual underwriting add up to a good fit for that audience. The bank is well-funded, FTSE 250 listed and FCA regulated, and its servicing reputation is solid.

The case against is narrower. If you are comparing on headline rate alone for a single standard property, the high street BTL lenders (The Mortgage Works, BM Solutions, Accord) will often undercut Paragon. If you are buying owner-occupier commercial premises for a trading business, Allica, OakNorth or one of the high street commercial teams is a better starting point. And if you cannot or will not work through a broker, Paragon is the wrong shape of bank for you. Outside those exceptions, for any landlord pushing the professional end of the buy-to-let market in 2026, Paragon belongs on every shortlist, and very often wins it.

Frequently Asked Questions

• Does Paragon Bank lend on pure commercial property like offices or retail units?

  Not as its core business. Paragon’s commercial mortgage range is overwhelmingly buy-to-let on residential investment property: single-let, HMO and MUFB, in personal names or limited company SPVs. Pure commercial assets like offices, retail parades and warehouses are not its sweet spot, and brokers will typically place that work with Shawbrook, Allica, OakNorth or InterBay instead.

• What is the maximum LTV available on a Paragon commercial mortgage?

  Up to 80% LTV on Single Self-Contained buy-to-let property with an EPC rating of A to C, following the increase from 75% in April 2025. HMOs, MUFBs and properties with weaker EPC bands typically cap out lower, in the 70–75% range, depending on product and stress test.

• Can I apply directly to Paragon, or do I have to use a broker?

  In practice, you go through a broker. Paragon is an intermediary-led lender and its commercial mortgage business is built around approved commercial mortgage brokers and their relationships with the bank’s Business Development Managers. A specialist broker will also help model the trade-off between nil-fee and percentage-fee products, which is where most landlords lose money on price.

• What ICR stress test does Paragon use?

  Paragon stresses affordability at a 5.00% Interest Coverage Ratio on products priced below 5%, and at the initial rate on products priced above it. It cut the rate from 5.50% to 5.00% in January 2024. The lower the stress rate, the more a given rent supports in borrowing.

• Are Paragon’s commercial mortgages regulated and protected by the FSCS?

  Paragon Bank PLC is FCA-authorised under FRN 604551 and regulated by the PRA and FCA. FSCS protection up to £120,000 covers eligible deposits with the bank, not lending. Most limited company buy-to-let mortgages fall outside FCA mortgage regulation, so the borrower protections under MCOB and the Financial Ombudsman Service are narrower than on a regulated owner-occupier mortgage: another reason to use an experienced commercial broker.