Commercial Business Finance – Kickstart your business challenge

Commercial business finance and/or a Commercial loan to assist the commercial growth of your business. Commercial business finance is designed for businesses as opposed to an individual or personal borrower. This facility is available in a range of differing options. While the commercial mortgage route was always predominantly the high street banks this is now not the case. There are now a host of specialist independent AltFi (Alternative Finance) lenders with increasing market share. These lenders have increased their market share due to service, flexibility and speed (processing). A commercial loan is an excellent option for any business looking to invest in capital equipment or even staff and out sourcing. Other benefits include expansion, new contract funding and turnaround.

Commercial Business Finance advantages

If a business has an irregular business stream and/or been hit hard by Covid a commercial loan can provide a welcome cash flow boost. Commercial business finance offers far more flexibility to small businesses. Lenders are more often than not far more forgiving towards a history of adverse credit. Furthermore a more flexible approach means looking further beyond a problematic credit past. High street banks will more often than not refuse commercial loan funding to a business with adverse history. Commercial business finance can assist towards a clearer future and open up opportunities. For SME’s a commercial loan represents a much more feasible alternative to the high street bank. SME’s represent 99% of all businesses within the EU.

Commercial Loan to maintain business ownership

A commercial loan will maintain business ownership. An established business that invariably has been hard fought for throughout the peaks and troughs. While an alternative to a loan may be to sell shares and/or equity in your business this comes at a high personal cost. Invariably after leveraged funding via equity many business owners end up as outsiders with limited decision making . It costs nothing to pursue a commercial loan option to keep your business as owner occupied. The business will receive additional working capital and the business owner retains 100% control. Unlike a bridging loan commercial business finance can be raised with a mix of bricks and mortar and the financial success/goodwill of the business.

What is a Commercial Mortgage

A commercial mortgage is the go to solution for purchasing commercial or industrial property. Purchases can include anything from office blocks, department stores, factories, farm land, workshops and corner shops. However whether a property is owner occupied or tenanted a commercial mortgage can provide straightforward funding for these important purchases. Ideally the property will be freehold or long leasehold (50 years plus) and the finance will be secured against the property. Should the loan repayments be dependent on rental income then the tenant quality and rental income will be a priority to your lender. Other points to consider is that any other existing commitments can be rolled up in to the new loan facility.

A loan facility can also be used to purchase an existing business. The owners of the business Commercial Business Financemay well be retiring or striking off in another direction. Purchasing an existing business is a nice option to cut through the hard work of establishing your own business. Typically not only will the business have existing operational premises but fixtures and fittings may well be inclusive or can be negotiated. There may also be an existing established customer base and brand along with a presence whether online or physical. An existing business may come at a premium but without intrinsic/set up costs. A lender will look more favourably on lending to an established business purchase than financing a new venture.

What are the different types of loan available and what do they cover. You may already own a commercial property so a remortgage is a nice option. If you have a commercial property, land or an industrial unit that is unencumbered or has substantial equity then restructuring the first charge security over your property will allow you to access cash. Alternatively if there are lender redemption penalties a second mortgage may be an alternative. Funding is also available for owner occupied or investment i.e. buying or letting of commercial property. Good tenants who provide an additional income stream can be accommodated.

An agricultural mortgage can be used to purchase buildings, farm land and associated. Including but not restricted to kennels, milking parlours, farm shops, equestrian centres etc. Repayment holidays and seasonal payments may be available together with variable or fixed rates. During the recent pandemic it has become difficult to prove income, self certification facilities are available to the self employed. Self certification commercial loans can be used for industrial properties, leisure, offices, nursing homes, warehouses, offices and retail. Interest rates will vary depending on an applicant’s circumstances. A commercial mortgage may still be available with an adverse credit history. However invariably more expensive and more rigorous underwriting.

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