Mortgages for buying a Hotel, Pub or Restaurant

Buying or Refinancing a Club, Hotel, Resort or Restaurant

We is among the UK’s experts in organising Commercial Mortgages for our customers, whether they are buying brand-new offices, or re-financing existing enterprises.

Securing commercial mortgages for bars, hotels, resorts and restaurants needs a great deal of care and experience in the commercial mortgage market as lenders may apply stricter lending criteria and demand lower loan to value ratios than some other sorts of commercial mortgages. Understanding exactly what the lenders are looking for, and what information we can make use of (if any) to ensure the application is accepted with positive terms is one of our main objectives.

We use our comprehensive understanding of the commercial mortgage products available, together with our substantial experience gained by dealing with the commercial mortgage providers, to find and secure the most suitable financing option for you.

The benefits of a commercial mortgage broker

Time is valuable to everyone, but particularly for our consumers who need an commercial mortgage. Typically customers are running a local small business and planning to relocate to bigger properties, or are aiming to move from leased to owed premises, indicating that they are concurrently running a local small business and trying to organize a mortgage. We can save you the headache of trying to do both these jobs by finding a mortgage that matches you.

Commercial mortgages for purchasing a bar

For clients wishing to borrow to purchase a pub, they are frequently purchasing the business, any fixtures and fittings, and the goodwill of the business, if the bar is purchased as a going concern. Due to this the amount that lenders will fund is commonly over fifty per cent of the value of the premises, although this relies on an individual’s accounts.

Sometimes it is possible to organize a commercial mortgage for a bar without accounts, such as if you have a fifty per cent deposit and other outside income that will be maintained, but this is the exception and not the standard. There is also the option to receive ‘top up’ funding from the brewery and some people use their residence, or various other freehold property, as collateral security, in which case there is often the alternative to borrow the total cost of the business.

For customers wishing to obtain a commercial mortgage for a public house there is the option with many mortgage providers to have an interest only period of payment for the first twelve months, and mortgages can be taken for 15 to 25 years. It remains that mortgages can be paid back early, or in a lump sum, without charge. It is essential to understand the accounts, and financial strength, of the company that you intend to buy as this can be crucial in working out the right rate for your mortgage. Using a broker means that you can rest assured that we will do this for you.

commercial mortgages for purchasing a hotel

Lots of customers are attracted to the idea of purchasing a hotel, whether as a retirement venture or a new profession. There are over 50,000 hotels and resorts in the UK * therefore there is a rewarding market in supplying commercial mortgages for these clients.

Typically mortgages are offered not only for purchasing but also for refinancing, financial obligation consolidation, and repair of the hotel. Due to the number of hotels, and the attraction of buying one, lenders are usually keen to see a business plan with clear forecasts of earnings. In addition lenders would wish to see some, if not all, of the following: evidence of identity; 3 months’ individual bank statements; 3 months’ trading bank statements; a business strategy; and proof of experience. These variables, like with a bar, frequently identify the LTV ratio of your mortgage offer.

For customers wanting to purchase a hotel and resort, the repayment choices are numerous. There is the choice to have fixed rate or variable loans, and also the possibility to pay back over a period varying from 15 to 25 years. The essential thing is, like with a bar, to have a clear understanding of why you believe that the hotel you are purchasing is profitable and to have a clear business plan which will show mortgage providers how you mean to meet the mortgage payments.

* According to The Catering and Hotel Caretaker Record published on their site.

Mortgages for purchasing a dining establishment, guest houses and B&B’s are another popular alternative. The increase in demand for these freehold properties has meant that mortgage providers are usually happy to deal with clients wishing to open a guest house, or B &B, since they provide excellent security. The LTV ratio of this sector has increased due to the fact that mortgage providers also believe that guest houses have strong recurring residential value, and so it is often possible to protect large amounts of money through this sort of mortgage. Although it differs across mortgage providers, clients could anticipate to obtain 70 -75 per cent LTV, with borrowing terms across 15 to 25 years.

Like all commercial mortgages there are certain criteria that may effect how much you can borrow. Buyers with deposits of over thirty per cent are very attractive to lenders as are those with added security, such as a mortgage-free house or various other businesses. A business plan, some experience of the market, and an excellent credit history also assist clients to obtain the best commercial mortgage. Like lenders for bars, hotels and resorts, mortgage providers like to see good account records, or projections of earnings that are based on sensible requirements. The same requirements apply to candidates who want to re-finance their mortgages, whether to consolidate financial obligations or accomplish a mortgage at a lower rate, or move a mortgage onto a fixed rate.

Whatever your borrowing requirements, we are the first port of call in ensuring that you get the best choices and options for your circumstances. It is simple to get bogged down in the information of mortgage applications and items, but we can do that for you. In addition our terrific relationship with loan providers means that we can match you to the right mortgage provider, saving you wasted applications that could taint your credit file.

The Financial Conduct Authority does not control some kinds of Commercial Mortgage

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