Market conditions have continued to improve during the year and there is a noticeable increase in terms of borrowers seeking funding and in lenders’ appetite for new business across the sector.
In the past 18 months, there has been a significant improvement in lender attitudes towards first-time buyers who have scalable business plans, sector experience and some capital to invest.
There is no denying that it had been tough for first-time buyers looking to secure funding in the pub sector, but with the addition of ‘challenger’ banks seeking to take market share, we have found that there are certainly a lot more options available for us to source finance on behalf of our clients.
This increase in options has allowed us to help more new entrants to acquire their first business.
So what do lenders look for when assessing a first-time buyer for finance? Typical information includes your career history and past experience, a detailed business plan and financial projections with stated assumptions for the business moving forward.
Applicants should have this information to hand; with this information we can provide an accurate indication of the terms that are likely to be available.
In terms of don’ts, the biggest mistake first-time buyers make is to approach just the bank that manages their personal account. In such a specialist and competitive market, it is vital to throw your net as wide as possible to ensure buyers secure the most appropriate banking facilities.
We maintain strong relationships with banks, as the predominant source of lending, as well as niche funders such as peer-to-peer lenders and small finances houses.
Nicholas Baker is head of business mortgages at Christie Finance, an independent commercial mortgage broker