If you’ve ever thought about opening your own small hotel, one of the first questions you’ll probably have is: ‘how do I finance it?’
Financing a hotel is always going to be a challenge, regardless of the economic climate, particularly for those who are new to trade or first-time buyers with no track record. The good news is that we can help you.
It’s a vibrant sector; there’s strong demand for high-quality, freehold properties at the moment. What’s more, lenders are keen to offer hotel funding to the sector, as a freehold asset is largely seen as excellent security. The loan-to-value ratio (i.e. what you are borrowing against the value of the business) has remained static in this area, typically around 60-70%, although it is possible to secure higher levels of debt if you have additional security, provided it meets the lender’s commercial mortgage criteria.
Factors affecting hotel lending
Numerous factors have an impact on securing hotel finance, and with our help, we can make your application for a hotel mortgage far more attractive to a lender:
– A deposit of 30% or more
– Additional security
– Business plan
– Proof of experience in sector or other relevant experience
– Good personal credit history
– Three years’ vendors trading accounts
– Comprehensive debt application from Stewart Hindley & Partners.
Of course, there’s a process to follow, knowing which lenders are best suited to your needs and that’s where we come in.
Expert help from experienced hotel finance brokers
At Stewart Hindley & Partners, we pride ourselves on our friendly approach and will guide you through the process of obtaining finance. We’ll help you with your application and ensure that you understand every step, from start to finish.
As we’ve worked in the sector for so many years, we’ve established strong and trusting relationships with many lenders, so will strive to find you the very best deal. It works, too – last year alone, we processed some £45 million-worth of business loan applications for clients.
What’s more, as we are part of an established firm of Chartered and Certified Accountants, we have the knowledge, capability and contacts to arrange hotel financing deals on almost any scale, negotiating terms to exactly fit your needs at any one time.
Our fee structure and the small print
At Stewart Hindley & Partners, we pledge to source and arrange the most competitive loan or specialist hotel mortgage on your behalf. This will be subject to market conditions, your personal and financial circumstances, and the market valuation of the business to be purchased.
We operate a ‘No Win, No Fee’ philosophy, which means that our broker fee is only payable upon your written acceptance of an offer of finance from ourselves or the lender directly.
You can discuss these terms and conditions with your local Stewart Hindley business finance broker, who will guide you through our fee structure and all other costs associated with your business purchase.