A client approached us looking to purchase a 28-bedroom care home valued at £850,000. Despite previous challenges with other high street lenders, we were able to secure a commercial finance solution that supported the client's growth plans.
The Client:
Our client was an experienced care home operator and was looking to add to an existing care home to their portfolio. The new purchase was being made through a limited company as part of a strategic expansion.
The Situation:
The target care home had been underperforming financially due to the outgoing owner’s reliance on costly agency staff and a lack of hands-on management, as they were preparing for retirement. These factors made it difficult for the client and their broker to obtain funding from high street lenders.
Our Solution:
We approached a range of lenders and successfully secured a commercial mortgage through one of the challenger banks on our panel. The lender was willing to consider the client's experience, projected income from the new management structure, and management accounts, rather than relying solely on the historical performance of the business.
Benefits & Results:
We successfully secured a £595,000 loan at 70% LTV with a fixed interest rate of 7.25% for five years, offering the client valuable rate security. The 20-year term provided long-term affordability, aligning with the client’s business plans for sustainable growth. By securing funding based on projected income and management accounts, we enabled the client to complete the purchase of the care home and implement a turnaround strategy. This case demonstrated our ability to find solutions where others couldn’t, by leveraging our strong lender relationships and our deep understanding of complex commercial finance cases.