There are many different products available in terms of property finance for purchase and development.
Commercial Mortgages
Commercial mortgages can be used to purchase shops/offices and warehouses. Working in the same way as residential mortgages they spread the cost over an agreed period.
The most common commercial mortgage is an existing business buying its own premises from which they operate. This allows you to stop paying rent and start paying back the commercial mortgage, eventually owning the property outright.
You can sometimes obtain 100% finance if you have a good trading record and additional security.
A commercial mortgage might be suitable for an experienced landlord who wants to buy further properties and place several properties on one mortgage.
We have a great relationship with advisors at Samera. We are in middle of a purchase. Samera advisors are doing an amazing and thorough job, from assessing practices, obtaining loan to providing accounting services. Nigel has been very patient, understanding and considerate. Overall, very happy with the service and would highly recommend.
Five stars
Auction Finance
Properties bought at auction usually have to be paid for within 28 days, there are lenders who specialise in auction finance. This is much quicker than obtaining a commercial mortgage but interest rates are higher due to the short-term nature of the finance. Usually, owners will remortgage in due course on to a standard commercial mortgage
Some lenders will give you an agreement in principle prior to an auction, this usually has conditions such as the type/condition and price of the property.
Bridging Finance
This type of lending covers any short-term finance to cover building and development costs. Usually, this type of property finance runs for 3-24 months with interest charged on a monthly basis.
Used to cover the funding gap where a property has been purchased and the mortgage is not in place.
Development Finance
Development finance covers both land purchase and building costs. A lender will look to finance a percentage of the land purchase and the building costs.
The Gross Development Value (GDV) will show the return on the project at the end of the development, whether it is a refurbishment of an existing property or a full build of a property from an empty piece of land. Lenders are repaid from the first properties sold.
You need to assess your project as to costs, land purchase/build costs/sale costs in best and worst scenarios. You then need to find the right finance to take the project forward at the outset.
Click here to read our article on how to finance a healthcare business.
Property Finance in SE England
For more information on raising commercial property finance for your business in SE England, please choose from the following links:
- Commercial Property Finance in Buckinghamshire
- Commercial Property Finance in Essex
- Commercial Property Finance in Hertfordshire
- Commercial Property Finance in Kent
- Commercial Property Finance in Surrey
Case Studies
The Problem:
One of our recent clients was looking to purchase new premises for their business. They wanted to transfer their existing business to their new premises from the current place they work and pay rent.
The smart move was coming to us first.
The Solution:
After our own information gathering and structuring, we approached the lender as our client’s broker. We provided the full story and the relevant information in the proper way and we obtained a great deal!
The Result:
Our client has been offered a 20-year, 100% mortgage! They can now buy their new premises and work exactly where they want to.
“Mr Nigel Crossman has looked after us throughout the process of investing in dental practice. We first made contact with Nigel and he was extremely approachable, methodical and most of all professional. He used language we could understand and no task was too onerous or complicated. He saw opportunities when others saw hurdles. Communication is one of his strongest points and doing so in a clear and concise way helped us immensely. I strongly recommend both Mr Crossman personally and Samera.”
Five stars
The Problem:
We were recently approached by a new client for some help with buying the freehold of their existing practice. They wanted to have a chat to see if the deal they were being offered by their present bankers was the best they could get.
It’s important to understand that a lender will only be able to offer what they have. They cannot and will not direct you to a better deal elsewhere. In most cases, they are not even aware of a better deal elsewhere!
The Solution:
As we are independent of any lender or sales agent, we have the ability to shop around on our clients’ behalf and find a range of suitable deals. More often than not, we will be able to find better deals and terms than a client will be offered directly by a lender.
This is down to our extensive network of lenders, our ability to negotiate terms and our experience with putting together successful applications.
This is exactly what we did.
The Result:
Having collected information on the practice like the goodwill value and EBITDA, we were able to provide the client with two better offers. This resulted in them placing the property purchase with a second lender and, having spoken with their accountant, they placed the property into a separate limited company on our advice.
Commercial Loans for Healthcare Businesses
We’ve been helping to fund the future of British healthcare businesses for over 20 years and our team are made up of former bankers with decades of experience in the UK’s healthcare lending sector.
You can find out more about working with Samera and the financial services we offer by booking a free consultation with one of the Samera team at a time that suits you (including evenings) or by reading more about our financial services at the links below.
For more information on raising finance for your healthcare business, including more articles, videos and webinars check out our Learning Centre here, full of articles and webinars like our How to Guide on Financing a Dental Practice.
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