Commercial Lending is a very specialised area of lending and too often our clients rely on their own bank for this form of funding. Veracity Financial Planning has developed strong links with experienced and trustworthy Commercial Lending Brokers and would be happy to discuss your requirements and put you in touch with the right broker for your requirements
Commercial Mortgages – Including Business Loans and Overdrafts
A commercial mortgage is long term funding, secured on a property which is not used for residential purposes, an area traditionally dominated by high street banks.
The range of lenders is considerable & too many people rely solely on their own bank for this type of loan.
A broker will act from the point of enquiry to the release of funds, taking care of negotiations with the lender and over-viewing all documentation, on your behalf.
How much can be borrowed depends on a range of factors, but typically between 70% and 80% of property value. However sometimes 100% funding would be available in some circumstances.
Asset finance & leasing for:
Management Buy-Ins and Buy-Outs
MBI and MBO transactions may include a combination of equity, bank lending, asset and invoice finance – and involve a number of providers.
A broker acts as the one point of contact for the client and the providers, to ensure that each understands the overall objective and their own role in facilitating a successful deal, ensuring that the transaction is effectively managed & that funding is on the best terms available in the marketplace
Business and Banking Advisory Services
Quite often, long standing customers are those who receive the least competitive terms and conditions. It is important to review existing facilities and to be aware of what is available from other banks. A broker acts on your behalf when negotiating with existing suppliers, or can arrange for a refinance package to be put in place.
Buying or Selling a Business
Buying a business is an exciting but daunting venture to embark upon.
The business may already have an established income stream and a sound reputation – but careful analysis of all the information available is vital to ensure that the business is right for you.
A broker has the experience to interpret financial accounts, highlight the strengths of a business and identify the risks in any prospective purchase or sale as well as help formulate a comprehensive business plan to enable you to secure the funding option that is right for you.
DTI Small Firms Loans Guarantee Scheme
If you have a viable business plan, but are unable to attract conventional funding because you have no available assets to offer to the lender as security, the Small Firms Loan Guarantee Scheme can overcome this by giving the lender a government guarantee against default in certain circumstances.
The terms and rules of eligibility can be complex. The scheme can be used to back loans of up to £250,000, with a guarantee of 75%, for which the borrower pays a premium of 2% on the loan balance – payable to the Department of Trade and Industry.
A broker will lead you through the process from the writing of the business plan, through completion of the paperwork and legal requirements – to drawdown and will identify a lender who has knowledge and comfort with your sector and who can provide terms beneficial to you.
Finance for Pension Funds (SASS or SSIP)
The primary reason to purchase or hold property within a pension fund, SASS or SIPP, is to maximise the tax advantages.
A broker works closely with lenders who have a comprehensive understanding of finance for pension funds.
SASS and SIPPs can invest in commercial property, but the borrowing is restricted to a maximum of 50% of the fund value. The purchase of a property in this way can be supplemented by borrowing the balance outside the pension fund – subject to the lender’s criteria. In this way, the borrowing could be from one persons pension plan or across several plans owned by different members.
Development finance is a highly specialised area and sourcing the right levels of finance requires time, meticulous research and meetings… all of which can be a hindrance to busy developers.
A broker can source and negotiate terms for residential development funding on your behalf across the marketplace ensuring there are several prospective lenders available in the background.
Access to land acquisition, construction and if required mezzanine funding of up to 100%.
Lending Against Investment
This presents a useful option for clients who have invested capital for the long-term and an unexpected opportunity has arisen but liquidising assets may lead to significant losses or tax charges – lending can be secured by the client’s investment.
The amounts that can be borrowed against different types of investment vary according to risk, as will the available interest rate. Against cash deposits, 100% funding can be achieved, whereas share portfolios will be assessed based on the types and spread of investment.
Finance for Professionals
Specialist professions; which include doctors, dentists, vets, accountants and solicitors [although this list contains many others] have unique requirements when it comes to finance. Practice or partnership facilities are available to assist with the purchase of business premises and other assets and 100% funding can be arranged.
Individually, professionals may need funding when they have the option of becoming an equity holder in a practice. Significant funding can be arranged and often without the need to provide security.
In both cases, interest rates are available to reflect the integrity, profitability and financial standing of the borrower.
Lending to Limited Companies or Other SPV’s
Incorporating principal private residences and buy-to-let investment properties and enabling professional investors to ring-fence property transactions, using a suitable special purpose vehicle (SPV) for ownership.
Investors with multiple properties are sometimes advised by their accountant to hold future investments in a limited company for tax advantages. Some lenders can allow existing trading Companies to hold investment properties, whereas others specialise in lending to newly formed SPVs.
In some situations, clients have previously been advised to hold their principal main residence and associated borrowings, in a limited company for tax reasons. These arrangements have historically been provided by their own bank, on sometimes uncompetitive commercial terms. Due to a change in the market, terms are often available to reduce overall interest costs.
We are Independent Financial Advisers in Nottingham and Nottinghamshire, offering Independent Financial Advice in Nottingham & Nottinghamshire. If you are looking for financial advice from an IFA we will happily discuss any area of interest or concern with you and whilst we pride ourselves on being able to deal with most areas of advice, if we are unable to advise or we know of a better route for you, we will be happy to guide you in the right direction.
Our areas of specialty are: pensions, investments, mortgages, life insurance, critical illness, income protection & private medical insurance.
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