Today’s #LoveLending topic is all about bank funding and how Fiducia can help you organise finance through the banks.
There are two types of banks, high street banks such as NatWest and challenger banks such as Shawbrook.
For a business, each type have their merits so it’s important to choose which is best for you. High street banks tend to offer the best rates on the market but have a higher coverage and will lend to fewer businesses due to risk profiles. Challenger banks have a lower coverage allowing them to offer higher lend amounts. The cost here is that rates will be typically higher than the high street banks.
The important message we would like to highlight is that there is more than the 6 banks you see on the high street. Over the last few years Challenger banks have established their place in the market and may be the right solution for your business. By speaking to Commercial Solutions team, we can make sure you obtain the best option that may not be advertised on the high street.
Bank funding can used to support a wide range of financial objectives from aiding acquisitions and mergers to purchasing any property type from retail units to farms.
Fiducia Success Stories
· Looking to move from her rented premises into a bigger space to expand business
· £80,000 purchase price
· 80% loan agreed
· This move will put her in a better position on the high street and allow her to get £6000 of stock currently held in the backroom on show
· She runs a second hand game shop
· Clients were in the process of completing the build of 3 new flats, the building was water and weather tight and needed the internals completing
· Clients wanted to raise funds from the unencumbered site to purchase more property
· Raised 70% for them through Shawbrook giving then £300,000 to keep building their business
· These funds allowed them to purchase a new investment property and also complete the development of another site quicker, speeding up their cashflow
· Once the flats were complete the clients sold and cleared their mortgage with no redemption fees
· Have portfolio of 18 properties mortgage with Lloyds, they wanted to reduce their payments and increase the lending to the maximum giving them more cash to buy more but were conscious of increasing their loan repayments as they used the surplus rental to live on
· We were able to secure 75% LTV with Shawbrook on a 10 year interest only facility
· This gave them over £200,000 to purchase more property and didn’t increase their payments
· This meant the clients were able to increase their portfolio which in turn gave them a better income
Our consultants at Fiducia Commercial Solutions can advise and organise this for you, so give us an email or request a callback for advice.
UK Government: SME Finance consultation