We work with a number of partners including the high street banks and specialist funders in the sector and are able to tailor a structure/package to obtain you the funding you require whether it is purchasing new premises or refinancing existing premises.
FACTS
Funders will take the following into consideration when assessing their appetite to lend:
Background
Experience of the borrower in the sector
Lease Terms
Including amount of rental income, length of lease, any landlord or tenant breaks , whether it is Fully Repairing and Insuring and details of how uplifts in rent are calculated.
The tenant covenant
This will include due diligence on the tenant to establish their financial strength and their ability to pay rent.
Loan to Value
A funder will want to appoint their own Independent Valuer to determine the Investment Value i.e. the value subject to the lease and the vacant possession value.
Net Rental versus Debt Service Costs
A funder will want to have Net Rent (gross rent less costs to manage the properties) to cover the Loan Repayments with a margin. They will want to ensure that the business can still meet the repayments if interest rates should rise and will sensitise with a default rate typically 2 to 3% above the rate for the Loan.