Category Archives: Advice & Articles

How To Turn Your Home Into a Guesthouse

Running a guesthouse can be rewarding and fun, not to mention a great way to make money from your property without having to sell it.

However, it’s important to keep in mind that running a guesthouse is a big commitment, and there are rules to follow and standards to meet.

Here are just some of the things you need to consider if you’re thinking of turning your home into a guesthouse.

Starting a guesthouse business

Get The Relevant Permissions

Before you can open your guesthouse, you’ll need to acquire the relevant permissions, so your first step should be to contact your local council to see what is legally required.

If you’ll be carrying out building work on the property, you may need to apply for planning permission. Regulations change frequently and vary depending on where your property is located, so be sure to check in with your local planning office.

Even if you aren’t making any structural changes to the property, you might need to complete a change of use application before you can open your home as a guesthouse. Again, ensure you check these details with your local council.

You’ll also need to comply with fire and gas safety legislations, as well as food standards if you’re planning on serving any meals on the premises.  Find out more by contacting your local environmental health department.

Finally, make sure you contact your mortgage provider and insurer. You may need to update your policy and will need to switch your existing mortgage to a commercial mortgage.

Fit Out The Guest Rooms

Once all the relevant permissions are in place, you’ll need to ensure that your property is up to the job of hosting visitors. That means properly furnished bedrooms with facilities including WiFi, TVs, storage space, and tea and coffee making facilities. Today, most guests will also expect their room to come with an en suite bathroom.

If you’re offering breakfast or other meals at your guesthouse, you’ll need a dining room where your guests can comfortably enjoy their meals.

Finishing touches such as bathrobes, slippers, and washing products can go a long way to ensuring your guests have a memorable experience.

Market Your Guesthouse

If you want to promote your guesthouse effectively, a good website is essential – make sure it’s responsive on all devices, appealing, and optimised for search engines such as Google. Social media platforms like Facebook and Instagram are also useful ways to market your guesthouse successfully.

Running Your Guesthouse

Running a guesthouse can be immensely enjoyable and rewarding, but you’ll also come up against several challenges.

One thing to always keep in mind is that this isn’t just a hobby, you’re running a business and it’s important to approach every aspect of your guesthouse with a business mind to ensure that it is a success.

That’s not to say you shouldn’t have fun! Part of the attraction of running a guesthouse is the interaction with guests, building lasting friendships and ensuring visitors get the most out of their stay.

Running a guesthouse is flexible – you can choose when you want people to stay and when you’d rather have the space to yourself. But it’s important to set boundaries if you want to avoid working 24/7 and burning out. Have house policies in place, including setting out the times breakfast will be available and when reception service will be provided.

Get In Touch

If you’re thinking of turning your home into a guesthouse, get in touch. We can help you find the most effective way to re-finance or release capital to launch your guesthouse.

6 Things You Need To Know Before Buying Commercial Property

Guest Blog

In most circumstances, buying property can be considered a sound investment. This applies as much to commercial property as it does to a domestic property purchase. But in the same way that you would not buy a private house until you had gone through all the checks and put everything in place ready to make an offer, commercial property also requires that you attend to certain preliminaries before making any commitment. So here’s a list of six tasks which should definitely be on your to-do list.

  1. Does this property meet your business needs?

It’s true that a rental property may offer a business a certain extra degree of flexibility, but the downside is often that the business owner has little control over future rental costs. By comparison, a property owner agrees mortgage terms at the outset and therefore has much more control over future outgoings. In addition, where business tenants may have limited options to modify their premises, commercial property owners are free to make any alterations their budget (and the local planning laws) will allow.

It’s usually wise to invest in something slightly larger than you currently require. That means you have room for expansion when needed, and there’s always the option to rent out part of a building to generate additional income while leaving yourself some flexibility to make further changes as required.

Remember too to check ‘business basics’ like adequate parking facilities and good access to the transport links your business trading demands.

  1. Is this the most suitable type of property?

Unless you are an experienced investor, don’t buy a commercial property just because it’s an irresistible deal. Commercial property falls into distinct categories such as business offices, retail premises, industrial sites, leisure accommodation and special-function units like schools and petrol stations. As a novice, that means you should always go for purpose-built property and forget any ideas about conversions and/or complexities like possible ‘change of use’ applications.

  1. Have you set your budget?

Your pending commercial property purchase is a business acquisition and thus will need to feature in your business development plans. That in turn means exploring, and fixing, the budget you have available prior to searching the market. And given that this purchase is also a business investment, part of your planning should also quantify what return you would expect for this capital injection, and specify the period over which you will reap the rewards.

  1. Optimise the location

Most high-performing businesses will positively benefit from an optimum location chosen wisely. That means making relevant decisions e.g. about city-centre or out-of-town sites, the location of your potential market, how close you want to be to your rivals, as well as considering the future growth potential of the area.

This is one element where it will pay to speak to professionals such as estate agents and business brokers.

  1. Assess the local property market

To make an informed decision, you will need to check features such as: local commercial property values and pricing trends, property taxes, mortgage interest rates and rental values. This will give you detailed information about how much your proposed commitment might cost, and what returns you might expect. And as regards investment returns, your analysis will be more helpful if it can establish what your short-, mid-term and longer-term prospects will look like.

  1. Check commercial mortgage availability

There is, of course, little purpose in searching for a property if you are not eligible for mortgage funding. This should be considered as two separate issues:

  1. a) gaining acceptance ‘in principle’ for commercial mortgage funding up to a certain amount;
  2. b) securing a commercial mortgage on a property you intend to purchase.

Obtaining a mortgage in principle is largely a matter of having a good credit record and meeting a provider’s lending criteria, whereas agreeing a mortgage on a specified property is likely to involve detailed structural surveys and property assessments.

Here again, it is likely to be in your interests to seek specialist advice in each of these areas, especially given that commercial mortgage providers will require such detailed information to decide whether they wish to quote mortgage terms.

Finding a commercial property

You may find commercial properties listed on different online sites and perhaps be tempted to go it alone armed with your portfolio of information. However, just as in the domestic property market, the input of local professionals and/or those who specialise in your business sector can prove invaluable. They will ensure you find the best property for your needs and secure a good purchase deal which meets your business investment objectives.

By Matthew Hernon is an Account Manager at Dynamis looking after Business Transfer Agents, Franchises and Commercial Properties across BusinessesForSale.com, FranchiseSales.com and PropertySales.com.

What You Need to Know About Financing a Pub Purchase

Many people who run pubs start off as tenants or leaseholders before considering buying a freehold once they’ve built up their knowledge, skills and experience.

Buying a pub and running it as a free house means you will be an independent business without any ties to a specific brewery or company – so you’ll be fully in charge of every decision.

Of course, buying a pub will usually require some form of finance. If you’re thinking about buying a pub, here’s what you need to know about financing a pub purchase.

Commercial mortgage for pubs

Taking out a commercial mortgage is another way to fund your pub. Working in the same way as a traditional, domestic mortgage, a commercial mortgage will be secured against the property and can form up to 75 percent of the market value of the pub.

Commercial mortgages can be surprisingly affordable. Unlike residential mortgages, they do not have standard rates of interest, meaning the lending manager will look at each application on its own merits in order to determine the level of risk involved and set the rate accordingly.

Of course, securing a mortgage that allows you to buy a freehold or leasehold pub naturally involves several different steps to those required to finance a house purchase.

Merchant cash advance for pubs

While a merchant cash advance is not a suitable finance method for funding the initial purchase of your pub, it may well provide an effective solution for covering costs such as equipment or other unexpected expenses, as well as expansion, stock, or renovation.

If you have a sudden or unexpected need for finance to keep your pub running and your customers happy, a merchant cash advance could provide a quick and flexible solution. This type of pub financing works particularly well for pubs that accept credit and debit card payments, as the advance is repaid this way.

Expert advice

If you’re looking for funding to finance a pub purchase, one of the first things you should do is consult a specialist broker who will be able to provide further information about the options available to you, and search the market for the best possible offers.

At Stewart Hindley, we are experts in this sector. Get in touch to find out more or to arrange a completely free, no-obligation consultation.

Everything You Need to Know About Commercial Mortgages

Whether you’re thinking of investing in a property for your business or you want to free up equity from an existing property, a commercial mortgage could be the answer.

Here’s our guide to everything you need to know about commercial mortgages.

What is a commercial mortgage?

A commercial mortgage is a mortgage that is specifically designed for buying or refinancing land or property for business purposes.

Commercial mortgages are typically available to cover 70 – 75 percent of a property’s value, and usually last between three and 25 years. Business mortgage plans differ from standard residential mortgages in several ways.

You’ll likely have to pay a higher interest rate than a residential mortgage and there aren’t generally any fixed rates available. However, in comparison to business loans, commercial mortgages do tend to offer better rates as they are secured against the property.

Is a commercial mortgage right for you?

If you’re a business looking to purchase a property or release value from an existing building, which can then be re-invested into the business, a commercial mortgage could be for you.

There are several benefits to taking out a commercial mortgage, for example:

  • The interest paid on a commercial mortgage is tax deductible
  • If the property increases in value, your equity could also increase

Is it hard to get a commercial mortgage?

Anyone can apply for a commercial mortgage, from small start-up businesses through to large, well-established enterprises.

Of course, like any mortgage, to qualify for a commercial mortgage, you’ll need to pass your lender’s eligibility checks and meet certain criteria. These checks typically analyse:

  • Cash flow and any debts
  • Projected income
  • Your ability to pay a deposit, usually ranging between 20 – 40 percent of the loan amount
  • General income, credit and assets

Just like a residential mortgage, it’s important to search the market for the best possible deal available. What’s more, commercial mortgages are generally quite complex, hiring a specialist broker can help make the application process far easier, while ensuring that you get the best deal on the market.

At Stewart Hindley Commercial Finance, we’re experts when it comes to commercial lending. With extensive market experience and knowledge, we can provide information and advice, and source the best possible deals.

Get in touch for a free, no-obligation consultation to discuss your commercial mortgage requirements.

The Definitive Guide on How to Market Your Hotel

You’ve set up an incredible hotel, with comfortable, stylish rooms, all the very latest amenities, and a great team.

But what use is having the best facilities, location, and customer service if no one knows you exist? That’s where marketing comes into play.

Building an effective marketing strategy for your hotel will help you to reach out to potential customers, maximise bookings and boost revenue.

Here’s our definitive guide to successfully marketing your hotel.

Get Online

Today, being online and present in the digital space is everything in the world of marketing. With at least 95 percent of consumers carrying out research online before the make any travel purchases, it’s vital that your hotel has a website if you want to effectively market it.

Your website is your shop front, and should be professional, credible, and show your hotel in the best possible light. Include plenty of high-quality images, video content, and details about the rooms and amenities.

It’s also well worth considering integrating an online booking system into your site to make it as seamless, quick and easy as possible for potential guests to arrange their stay.

Ensure You’re Easy to Find

Having a website isn’t enough. If you want to ensure your hotel is receiving as many enquiries as possible, it’s vital that your audience can successfully locate you online.

This means ensuring that your website is optimised for search engines (Google) – so, when guests search for hotels in your area, you come up as high as possible in the rankings.

Make The Most of TripAdvisor

While your website and social media platforms will allow you to tell everyone just how great your hotel is, TripAdvisor allows your guests to tell them – and that can be significantly more powerful.

Before booking a room at your hotel, most guests will check your reviews, so managing your online reputation is crucial.

TripAdvisor is the world’s largest travel review site, with approximately 390 million unique visitors each month. This presents a huge marketing opportunity for hotels.

So, make sure you set up your free TripAdvisor profile, populate it with as much useful information as possible, regularly check reviews and engage with your guests.

Respond to Reviews

Once you’ve started receiving reviews, it’s important to monitor them and respond accordingly.

It’s only natural that you’ll receive a less-than-perfect review from time to time, but the nature in which you respond to those reviews will make all the difference.

Make sure you respond to any negative reviews as quickly as possible and try to resolve or address the guest’s feedback or complaint in a useful manner.

Remarketing is Essential

Abandonment rates for booking hotels online are high, meaning plenty of potential guests will visit your site, start the booking process, and then get distracted and not complete the booking. This is where remarketing comes in.

A remarketing campaign will allow you to remind your guests about your hotel, provide them with extra incentives to book, and make completing the process as easy as possible.

Reward Customer Loyalty

Marketing isn’t just about targeting new customers – it’s just as important to reach out to existing customers and encourage them to revisit your hotel.

A customer loyalty scheme is an effective way to get your guests to return time and time again, by offering discounts and rewards to regular visitors.

Get in Touch

For more information about the hospitality business, and in particular hotel finance, please don’t hesitate to get in touch.

Is Short Term Finance Right For You?

Many businesses will find themselves in a position where they need to secure additional funds in order to cover expenses or take the next steps in growing their enterprise.

Of course, with finance, it’s important to carefully consider which type is right for you.

Here’s our guide to short term finance which will help to establish whether it’s right for you.

What is short term finance?

Short term finance is any borrowing that is paid back over a shorter period, typically in under one year.

What are the types of short term financing?

The main types of short term finance include:

Merchant cash advances

For companies receiving payments via credit or debit card, merchant cash advance usually relatively easy to secure and quick to fund.

Merchant cash advances are one of the most expensive types of short term finance, with the APR potentially reaching triple figures, depending on total sales each day.

The benefit of this short term funding method is that repayments are directly tied to sales, so if the business has a quiet month, the repayments will be lower in response.

Short term loans

Short term loans are typically less expensive than merchant cash advances. You’ll receive capital from your lender, which you’ll pay off with interest following an agreed schedule – just like a regular loan.

The key difference with a short term loan is that it is paid back over a much shorter period. A further benefit is that funding can usually be provided quickly (sometimes within 24 hours). However, there are also several disadvantages involved in this type of short term lending – you’ll be required to pay the loan back relatively quickly, make frequent payments, and the interest rate will usually be high.

Business line of credit

Business line of credit is one of the most affordable types of short term finance available.

Working in a similar way to a business credit card, if you qualify for a business line of credit, you’ll have access to a line of credit, from which you can pull working capital. You only have to pay back what you spend.

The benefits of business lines of credit is that they typically come with lower APRs than business credit cards, making them a great back up to have on hand ready to cover quieter spells or temporary cash flow issues. This short term finance method can be accessed in as little as one day.

Invoice financing

Invoice financing provides an advance payment for your business’ outstanding invoices.

This is a relatively quick and affordable form of short term finance, allowing with rates of around 3 percent plus 1 percent for each week the invoice remains unpaid. An advance can cover anywhere from 50 – 90 percent of an outstanding invoice. When the customer pays, you’ll receive the remaining amount minus the interest incurred.

What are the advantages and disadvantages of short term finance?

If you’re considering applying for short term finance, it’s important you’re aware of the pros and cons that come with this type of lending.

First, let’s take a look at the advantages of short term finance:

  • Access to quick capital when you need it most
  • Relatively easy to quality for, even with a low credit score or short business history
  • Shorter term means finance typically accumulates less interest

Of course, there are also disadvantages to consider:

  • Higher ARPs
  • Shorter payment terms, which can put strain on small business
  • Frequent payments
  • Arrangement fees and Exit fees may be applicable

Find out more

With extensive market knowledge, we’re experts when it comes to short term finance for businesses. To find out more about short term finance, the options available, and whether short term financing is right for you, please get in touch.

Holiday let cottage with a blooming flowerbed

How To Start A Holiday Let Business

Whether it’s a short break or a longer summer holiday, more and more of us are choosing to holiday in the UK.

As demand for holidays in the UK continues to grow, so do the opportunities available for those considering letting out a property to holiday makers.

If you’re thinking about starting a holiday let business, it can be an exciting yet daunting process. Here’s our guide:

Do Your Research

Before starting any business, it’s vital that you complete your research. So, the first step in setting up your holiday let business should always be to research the market, location and competition.

Points to consider in your research include:

  • Is the location popular?
  • Is there a demand for holiday lets in the area?
  • How much rental income could you earn?

Work Out Your Letting Rates

Your research will also help on pricing your letting rates. It’s important that you get your rates just right – too high and you risk your property sitting empty and too low and your profit margins will be down.

Conduct your research then set your letting rates accordingly. Once you’ve launched your business, you should also constantly review and adjust your letting rates to ensure that they are in line with market trends.

Prepare Your Property

If you want to attract guests and ensure they have an enjoyable stay, you need to make sure that your holiday let is well presented and kitted out with all the expected amenities.

The first thing your potential guests will see is the photos of your property, so décor should be stylish and appealing.

As well as looking the part, your property needs to comply with all relevant legislation and regulations.

Start Your Marketing

Once your property is prepared and your holiday let business is ready to go, you’ll need to start marketing your property so that guests can find you easily and book their stay.

Your business should be as visible as possible online and it’s also beneficial to have an online booking system to make reserving rooms as simple and straightforward as possible.

Find Out More

If you’re thinking of starting a holiday let business, it’s important that you have the necessary funding in place. To find out more or for a free, no-obligation quote, please get in touch.

Thinking of Selling your Hotel?

Thinking of Selling Your Hotel? Here’s How to Know it’s the Right Time

As an established hotel owner, you may perhaps have entertained the idea of selling your business. You may understand that timing plays a part in such decisions. But is now the best time? And how will you even know when that ‘best time’ actually comes around? It’s rarely an easy call to make, so here’s a few things you should consider.

Reasons for selling

Sometimes you may just have to accept the fact that you can’t really control your need to sell. Other aspects of life which cannot be put off may simply intervene. You, or your partner, may be suffering poor health, or you may have to face divorce or some other family crisis. Equally, you may be fast approaching retirement, or have been presented with some need to liquidate your assets which must take priority over your business responsibilities.

More often, as a hotelier, you may notice a relentless downward spiral in profitability. Whilst some owners catch the problem early and are able to take remedial measures, others may find things have gone far beyond any hope of retrieving the situation.

If your accommodation business is performing poorly with little hope of an upturn, then taking the decision to sell may be your best chance of selling at an acceptable price. In such unfortunate circumstances it may be best to salvage what you can rather than risk a further decline.

On the other hand, some hotel owners may recognise that their soundly performing business is presenting them with a golden opportunity to sell on their own terms. A business with a good track record will usually sell for a better price, and often sells far more quickly too. And this is especially so where the owner can show that profits are on a sustained upward trajectory.

Research the market

To determine your sale prospects, or even simply to optimise the outcome once you are nearly ready to commit, it will always pay to carefully research the market. Whilst that is likely to involve seeking professional opinions, it should also involve a thorough personal investigation. It’s only by immersing yourself in such detail that you can get a proper ‘feel’ for market conditions.

For instance: Are local sector trends a reflection of regional market conditions? Or are there local factors which are exerting a stronger influence? And considering the national picture: What do the long-term sale statistics say about the future prospects for the hotel industry? And what seems to be the optimum time of year for selling with a view to securing the best return on your investment?

The hotel industry is one that fluctuates and so you will need to keep a careful eye on what the future trends are. There are three main factors that will impact the value of your hotel: the profit that your business is making, what multiple of the profits the buyer is willing to pay and the condition of the business. Make sure that you are in a positive position with all three of these factors where possible if you want to make a good return on your investment.

Threats and opportunities

You may know some local owners are about to retire and close down, or be aware of plans for major leisure and tourist developments about to occur in your area. Indeed, such information may be just what you need to hear to give you an ideal chance to present your business as being rich in potential.

Or alternatively, you may have been advised that a national hotel chain has earmarked your town as a likely location for expansion, or perhaps you have lost some of your best staff who have proved well-nigh impossible to replace.

Whatever the scenario, if a hotel sale could be on the horizon, you must remain alert to how such developments could affect your prospects.

You should also identify whether there are areas where your business could expand in the future so that buyers can be promised the chance for expansion. Is there is the potential for more rooms to be added? Could a restaurant or spa be included as part of the business?

Assess what pre-sale preparation is required?

If you can afford to sell when you’re ready, you should also consider what pre-sale preparation will be necessary to get your business up to the mark in order to prepare for a listing. If you have a well-run hotel in good health with strong bookings, perhaps also supported by strong local patronage, you must also have the evidence to prove the worth of your business.

One extremely important element here is your business paperwork, which must be in excellent order. Any serious buyer will never take your word alone. They will wish to see historical evidence of your trading revenues, and much else besides.

Have clear documentation of the occupation rates and how this fluctuates during the year. You will also need to do an audit of the stock that will included at the time of handover of the hotel.

In addition to exemplary paperwork, your premises should be in good repair and decorated to a good standard throughout. But beyond maintenance, and just as important, you should ensure your hotel is equipped in a way which reflects the latest industry trends and emerging technologies.

This extends beyond micro-details such as contemporary coffee facilities in your rooms, and should certainly include an overhaul of your (hopefully) mobile-friendly hotel website as well as your booking systems and digital marketing strategy.

By Matthew Hernon is an Account Manager at Dynamis looking after Business Transfer Agents and Franchises across BusinessesForSale.com and FranchiseSales.com.

4 Tips for Appliance Safety in Your B&B

Beckie Hatton is a Product Manager at Home Appliance Care, so she understands exactly how important it is to have safe and efficient electrical appliances. Here, she offers her advice to B&B owners who want to follow the rules and keep guests safe.

All B&B owners have a legal responsibility to safeguard the public and their employees from harm (legislation.gov.uk). More specifically, you must make sure your electrical appliances are well-maintained and fit for purpose to prevent fires, gas leaks, electric shocks, and other disasters.

Small hospitality businesses that fail in their legal obligations can face serious consequences, from penalties and lawsuits to property damage and fatalities. So, it’s important to stay on top of maintaining the electrical appliances in your kitchen, guest rooms, and communal areas to keep your guests safe.

Below, I’ll be sharing some of my tips for making sure the appliances in your B&B are safe to use.

Which appliances to check

Any utensils and appliances that are battery operated or can be plugged into the mains must be well maintained and regularly reviewed. You should check them for signs or wear or damage at least once every month as part of your fire risk assessment (gov.uk), and they will have to be serviced or PAT tested every 6-12 months to be declared fit for use (pat.org.uk).

When you first think about which appliances in your B&B could be considered high-risk, most people rightly think of ovens, toasters and straighteners that are designed to heat up. But washing machines and tumble dryers account for more than a third of domestic fires, significantly more than cookers (11%), so it’s crucial that you keep on top of the maintenance of these appliances in particular (Which?).

Should I call an engineer?

You should contact an electrical engineer if you have any concerns about the internal wiring of your appliances rather than attempt to fix them yourself. Tampering with electrical systems can cause injuries or fatalities, and if you don’t have the right tools or knowledge you could put yourself and everyone else on the premises at risk.

Plus, tampering with your appliances usually voids their warranty and your insurance policy, so you’ll have to cover the cost of repairing and replacing any damaged machines. It’s safer and cheaper overall to let the professionals deal with it instead.

Common faults to watch out for

External issues like loose plugs, switches and outlets can often be amended by a quick screw retightening, and you can also replace any broken casings yourself using just basic tools and knowledge — but you must switch off and unplug everything first so there’s no electrical current.

If you notice your plugs, outlets and switches are getting warm, it could be a wiring issue that can cause a fire if not immediately fixed. In this case, these will need to be repaired or replaced as soon as possible and you should not attempt to use the appliance while you wait for the electrician.

Flickering lights or displays on your appliances, as well as your bulbs burning out too quickly, can be indicators that there is a loose connection somewhere inside the machine. If you notice any of these problems, you should stop using the appliance and call a professional immediately.

How to look after your appliances

Never skip your monthly fire risk assessments, annual services, or scheduled PAT tests. Fires and other electrical dangers don’t just happen as the result of faulty products — appliances that aren’t properly maintained pose a risk too. Failing to clean them properly, check them over regularly, and take care of small problems can lead to huge disasters, so you must have adequate maintenance strategies in place to tackle all these issues.

Encourage your kitchen staff to clean appliances at the beginning and end of each day to prevent build ups of food crumbs, grease and other debris — just be sure that they follow the manufacturer’s instructions for doing this safely. Cleaning in a way the manual suggests will also protect your appliances from corrosive damage which can lead to electrical issues, such as loose wiring. So, hang onto your user manuals and double check all their cleaning practices are compliant with the manufacturer’s suggestions.

These are just some of the ways you can make sure the appliances in your B&B are as safe as possible. By giving them a quick look over as often as you can and promptly reporting any issues to an electrician, your appliances can be safe for use and you can get on with managing your guesthouse.

When do you need a commercial mortgage?

One question we’re often asked is, ‘when do I need a commercial mortgage?’

The simple answer is that if you are looking for a commercial premises, either for an office, a shop or even a manufacturing unit or workshop, and you, like most people, can’t afford to buy premises outright, then a commercial mortgage is what you’ll need.

Aside from investing in a new property, you may want a commercial mortgage if you are looking to extend a premises or refurbish or update a property.

What is a commercial mortgage?

Funds borrowed against a commercial mortgage are protected with the bank having a registered interest in the property in the same way that your domestic mortgage would.

Why can’t I just borrow against my existing mortgage?

It’s essential that when you are borrowing for a business, you borrow against a commercial mortgage because borrowing against a standard domestic mortgage could mean you are risking your home and your business.

A commercial mortgage works differently to a standard mortgage. Decisions to approve a commercial mortgage will take into consideration your business plan, expected returns, and also the way in which the property will be used.

Commercial mortgages can be more generous than domestic mortgages, but you will need a decent deposit of 2030% or more.

That’s not all, you’ll also need to convince the lender that you know what you’re doing.

Ideally, you’ll have some proof of experience in the sector. You’ll need a good personal credit history and, if you already run a business, the lender will want to see your trading accounts to make sure you’re responsible with your cash.

They’ll also expect a comprehensive debt proposal. It’s not easy to secure a commercial mortgage but if you know what lenders are looking for, and have the information that they need available, you can substantially boost your chances of a positive response to your application.

You can also get specific sector mortgages too, such as hospitality mortgages, which are designed to support investors in that particular niche. Often their documentation and information requirements are slightly different, reflecting the nuances of that industry, but at Stewart Hindley, we have a team of specialists available to help you jump through the paperwork hoops and get the best chances at securing the right mortgage for you, whatever you need, whatever industry you are in.

To speak to our experts and find out more about how they can help you to find and secure the right commercial mortgage, or hospitality mortgage for your business, call us today on 01488 684834.