Re-structure of a Trading Business Loan to a Commercial Investment Loan

Deal Structure

75% Loan to Value

£375,000.00 loan facility

Interest Rate 5.79% fixed for 5 years, Interest Only

10-year term

Deal Summary

Our client had a loan with a High Street back dating back to when he purchased the Freehold of his convenience store.

He recently accepted an offer from a third party who wanted to purchase the business element, leaving our client with the Freehold, so he would collect rent from the purchaser of the business.

Our client approached his business bankers to inform them of the transaction and to ask them to consent to a lease, but he was told that despite his perfect conduct during the term of his current loan, they would require the loan to be repaid in full, as they would now class the loan as a Commercial property investment loan, which they could not support.

Fortunately for the client, our experience meant we knew which lenders to approach, and we were able to present the client with multiple indicative offers. The client chose to proceed with the lender that not only allowed them to repay the original loan but would also allow them to take out some extra cash that they could then use to invest in their other businesses.