We understand that when purchasing a pub business you are buying more than just the property itself. Our pub mortgage and business funding options are designed to cover the licence, the goodwill and fixtures and fittings as well as the building.
Main Features of a Pub Mortgage
The terms of a commercial loan against a public house vary considerably from lender to lender but as a general rule, the following will apply to a freehold business:
- 15 – 20 year mortgage term
Financial Solutions & Pub Loans
We are experienced in offering financial solutions for:
- debt consolidation
- capital raising (extensions)
- cash injections across the public house sector.
We are able to offer a pub loan for leasehold businesses to cover a short term lease of up to 35 years. Historically we have assisted with funding leases, the following should serve as a guide:
- Up to 70% loan to property value ratio
- 5-30 year mortgage term
A leasehold business is not recognised by the majority of lenders as sufficient security for the mortgage. Most will advance up to 50% of the ongoing costs, unless you are able to provide additional security such as a residential property.
Pub Re-Financing – Options for Pub Funding
Change the monthly payments
In essence, re-financing can alter the monthly payments owed on the loan either by changing the loan’s interest rate, or by altering the term to maturity of the loan. More favorable lending conditions may reduce overall borrowing costs. Re-financing is used in most cases to improve overall cash flow.
Reduce the risk
Another use of pub re-finance is to reduce the risk associated with an existing loan. Interest rates on adjustable-rate loans and mortgages shift up and down based on the movements of the various indices used to calculate them.
By re-financing an adjustable-rate pub mortgage into a fixed-rate one, the risk of interest rates increasing dramatically is removed, thus ensuring a steady interest rate over time.
Refinance your loans
In the context of personal (as opposed to corporate) finance, re-financing a loan or a series of debts can assist in paying off high-interest debt such as credit card debt, with lower-interest debt such as that of a fixed-rate home mortgage.
This can allow a lender to reduce borrowing costs by more closely aligning the cost of borrowing with the general credit worthiness and collateral security available from the borrower.
Pub Mortgage Fee Structure
Stewart Hindley guarantee to source and arrange the most competitive loan or specialist pub mortgage on your behalf which will be subject to market conditions, your own personal and financial circumstances, together with the market valuation of the business to be re-financed or 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.
Please discuss our 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.
Experienced Pub Finance Brokers
At Stewart Hindley & Partners our re-finance expertise will help steer you through the business re-financing options, ensuring that we understand the exposure and the level of risk and reward before we make commercial re-financing proposals.
We will get to understand how your business works, establish the benefits of expansion or re-investment and partner you with funding sources for hotel lending that are positioned to work to your advantage in today’s challenging environment.
Because we are part of an established firm of Chartered and Certified Accountants, we have the knowledge, capability and contacts to arrange business re-financing deals on almost any scale, negotiating terms to exactly fit your needs at any one time.
For more information please contact us.