Short Leasehold Business Finance

By: London Wall Associates Ltd  03/12/2010
Keywords: Business Insurance, commercial finance, commercial mortgages

 

Short leasehold business finance

It is not unusual for just commercial mortgages to be asked several times each year for finance from clients trying to buy retail outlets such as Indian restaurants, small supermarkets, fish & chips shops, dry cleaners, care homes and so on.

Five million ‘high street’ and other retail businesses are finding it increasingly difficult to source business funding

because they do not own the freehold of the building.

There is a limited appetite for lending against 'high street' leasehold businesses yet demand grows every year for this type of finance, we have short leasehold finance providers on our panel with a variety of products available.

One lender, we use specialises in this business area. With

funding options for both purchase and refinance, we now have the opportunity to provide alternative finance solutions to new and existing retail clients.

. Client benefits

• Simple application process

• Each case assessed individually

• A quote can be issued same day in most cases

• Lending governed strictly by affordability assessment of the business

Technical information

Short leasehold is where there is a formal commercial lease put in place on a premises.

Qualifying criteria

• Minimum business lease term remaining is 5 years

• Businesses normally need to have been trading for a minimum of 36 months

• Clients must be owner-operators or prospective owner-operators (i.e. no “investment” businesses)

• Businesses must be located in major towns and cities

• Loans available for and only

Purchase of a business

• 60% LTV of businesses with accommodation,

• Minimum loan £50,000

• Maximum loan term is the lower of half unexpired lease or 120 months

Refinance of a business

• 60% LTV of businesses with accommodation,

• Minimum loan £50,000

• Maximum loan term is the lower of half unexpired lease or 60 months

• Additional suitable additional freehold collateral security is required for refinance cases

Keywords: Business Insurance, commercial finance, commercial mortgage, Commercial Mortgage Rates, commercial mortgages, commercial property finance, commercial property insurance

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