Commercial leasehold sector is perhaps the biggest business sectors in the industry today. There are nearly 10 million commercial leasehold enterprises operational in the market at present, with as many as 20% changing their proprietor every year. These types of businesses trade in the field of health care, licensed sector, retail sector and leisure enterprises. It has to be noted that most of these are located on almost every high street area and many of them can experience difficulty in raising business leasehold finance. They need this kind of funding for buying or refinancing these types of businesses without putting any asset as security or collateral.
Traditional lenders do not support this marketplace with their whole heart and that is why they are a surprising element for most of the prospective leasehold business buyers. The fact is that the alternatives for financing businesses are very limited, as far as raising loans for purchasing short leasehold business or raising capital for improving or expanding businesses is concerned.
Finding loans in today’s business sector is too difficult mainly because the lease length available on associated commercial properties is usually 21 years or less. Mortgage lenders require minimum 40 years remaining on lease after the repayment of the mortgage loan, equity of other properties is required for the commercial lenders for even considering application of any funds.
Even if a legal charge has been re-assured over another property, many creditors will still not be able to tender short leasehold loans, keeping in mind these kinds of businesses as higher risk enterprises. That is why, business leasehold finance is not available to the business owners very easily and even if they find one, they will need to pay a very high cost for it.
For funding these types of ventures, it is always wise to find specialist commercial finance brokers who have in-depth understanding and knowledge of the sector of business leasehold finance. Because there are very few creditors in the market, there is much less competition and due to this, this kind of funding is available at comparatively very high rates. Qualified and experienced brokers will locate some low cost option for you, and at the same time help you in avoiding a wrong business leasehold finance. Therefore, if you choose your creditor or investor wisely and also take help from a professional and experienced broker too, business leasehold finance need not be necessarily expensive.