Asset finance is a finance option businesses can use to grow by acquiring much needed equipment, such as vehicle fleets, farm machinery and even aircrafts. You pay a regular amount to use the asset over an agreed period, avoiding the full cost of buying outright. Asset finance could make it easier to raise funds for additional finance needs, in contrast to traditional loans. Spreading costs of an asset and avoiding ownership costs such as maintenance, help maintain cash flow in your business. Asset financing also differs from a standard loan in that an asset secures the finance agreement.

A bridging loan is, as the name suggests, a loan to bridge the gap between the purchase of a property and an exit of the bridging finance either by way of sale of one of the properties, a remortgage to clear off the bridge or a combination of both sale and remortgage to clear the outstanding debt.

As a standard, bridging loans are taken over a 12 month term where there are no early repayment charges other than up to the first three months interest payments (this is dependent on lender). This means that if you look to repay the loan within the first three months of drawdown, you would be liable for a full three months interest payment. Any repayment following the three months will simply be based on however long the loan has been taken out for.

Lenders typically look to ‘roll up’ the interest payments as well. This is where the interest is added to the loan on a monthly basis and repaid in full along with the initial loan taken. The rolled up interest provides the benefit of having no additional expenditure throughout the term of the loan however, the rolled up interest is included in the lenders maximum loan to value which his typically 70-75% of the value of the properties owned.

Bridging lenders look for mainly 2 things to assess their application, the value of the securities and how the loan would be repaid. As long as there is a suitable exit in place, either that the sale of the currently owned clears the lending in full or that we are able to prove that a standard mortgage is available to cover off any shortfall from the repayment, the lender is likely to accept the application.

Bridging can be utilised to simply purchase a further property whilst the sale of a currently owned property goes through or alternatively, it can be utilised to enable clients to purchase a property to preform refurbishments as the property would not be in a suitable condition for a standard mortgage.

A commercial investment mortgage is a type of loan used to purchase or refinance a commercial or semi commercial property which is let to tenants.
The rates and fees charged are generally slightly higher than those charged where the property is owner-occupied..
They are the commercial counterpart to residential buy-to-let mortgages and work in a very similar way. There are a few main factors used when assessing an application, they revolve around the applicant, the property and the lease.
An applicants credit history, financial position and experience of letting both residential and commercial property is checked and must meet the lenders criteria.
A strong property is one that has a reasonable level of demand for letting or sales (in case a tenant is lost, or the property has to be sold). The surveyor will base their report on these factors and this forms a large part of the decision to lend.
A strong lease is one with a term of at least a few years remaining, to a financially robust tenant. The strength of the tenant is as important as the lease terms, as a tenant who is at risk of financial collapse will not be considered a reliable source of income.

Development finance is a short-term funding option, usually for between 6-24 months. It is designed specifically to assist with the purchase costs and build costs associated with a residential or commercial development project.
This can be a new build, conversion or refurbishment covering a single unit through to multiple units built across a number of phases.

A development loan comes in two parts

1. To purchase the site
The first element of the funding will often be used to assist with the purchase of the development site. This could be land where a number of new properties will be built or an existing property that will undergo a refurbishment.

2. To fund the building costs
The second stage of the loan is used to pay for the costs of the build works associated with the project. This is usually drawn in stages, as opposed to being given in one amount at the outset. This often happens once a month as works are completed on the project.

At The Loans Lab, we look at Healthcare Finance in two categories as below:

Primary Healthcare Sector
Qualified Professionals in the Healthcare Sector including GP’s (General Practitioners), Dentists, Pharmacists, Vets, Opticians, Chiropractors, Osteopaths, etc. All these professions take long periods of study to qualify and gain experience in. In addition, being self employed, all the practitioners will require finance from time to time either to buy into a practice, buy property or another business.
The majority of the opportunities would seem to be in the Dental and Pharmacy Sectors where clients want to grow their business. Loans can be structured over long periods up to a maximum term of 25 years.

Care Home Sector
This is a sector where care is provided within adapted or purpose-built properties and provides care for elderly residents, nursing clients, people with dementia or Learning or Mental Health issues. Finance is needed to enable these businesses to be bought with loans that can be repaid over a long period of time from available profits, e.g. 15, 20 or 25 years (usually for purpose built properties).

Invoice financing is a form of short-term borrowing in which your business borrows money against the amount due on invoices you’ve issued to your customers. These trade receivables are then used as collateral.

Invoice financing is used regularly in a wide range of sectors and industries, such as construction, retail, transportation, and consumer goods.

If a significant amount of your company’s assets is locked up in receivables, and if those receivables make up a very high percentage of your current assets (perhaps because of overly lengthy payment terms), invoice financing could help you avoid working capital issues. This can make invoice financing for small businesses an attractive option.

A portfolio mortgage allows landlords to place all of their buy to let mortgages under one mortgage. A portfolio mortgage is treated as a single account. Rather than having separate lenders for each property, the entire portfolio is undertaken by one lender, hence one monthly payment.

The portfolio is registered as a limited company and finances and expenditures are treated exactly the same as any other business model. A property portfolio is a term used for when a landlord has at least four properties. Technically, a portfolio could consist of two properties. From a lender’s perspective, they would usually class four properties to be the bare minimum for a portfolio.

Lenders introduced portfolio mortgages to allow landlords to manage their buy to let finances with greater clarity. Rather than having multiple mortgage statements, portfolio mortgages allow for one monthly statement and one payment, simple. Landlords with portfolios don’t have to have a portfolio mortgage and it is entirely optional.

Residential investment mortgages are designed specifically for property investors and landlords who buy residential property with the intention of renting it to tenants for commercial gain.
For this reason Residential investment are often more expensive, the interest rates charged are usually higher and a larger initial deposit is often required by the lender.
Residential investment mortgages are similar to buy to let mortgages, the difference being commercial investment mortgages are typically carried out through a limited company

Semi-commercial mortgages are property backed loans designed for property which is comprised of both residential and commercial elements.

They are available for a diverse array of properties and can be used to purchase or remortgage a property.

These loans are generally funded using a commercial mortgage lender and are treated in much the same way as a commercial mortgage.

The banner of ‘semi-commercial’ covers a wide range of properties. Any property that comprises of both a commercial element and living accommodation will be classed as semi-commercial.

Some lenders charge lower rates for semi-commercial properties than are charged for fully commercial buildings. Where this is the case, there are sometimes splits in the ratio of residential to commercial space needed to secure the lower rate.

Another point that could exclude your property from being eligible, is where there is a single access to the property, meaning it could only be occupied by a single tenant or business owner.

In this situation, some lenders will only lend using their full commercial rates.

A trading business mortgage is designed to allow you to fund the purchase or refinance a property for use as business premises.
These mortgages aren’t just used to purchase property, they can also be remortgaged just like a residential mortgage to secure a better deal. This is common where the business’ performance has improved over time and lenders now see you as a lower risk applicant.
Trading business mortgages let business owners borrow money needed to buy property or land for their business. Similar to a residential mortgage, the money is borrowed from a high street bank or specialist lender and is repaid in monthly instalments, along with interest.

An unsecured business loan allows you to borrow without having to secure the loan against any business assets, such as property, equipment or machinery. These loans are a relatively simple - and fast - way to get an affordable cash injection if your business lacks assets or if you don’t want to secure what assets you have against your loan.

An unsecured business loan provides businesses with upfront capital without requiring security. There are many different unsecured business loan options out there, each with varying terms to suit different kinds of businesses.

Loans are repaid in monthly or quarterly instalments over a fixed time frame, and you can choose to take out a short-term loan or medium/long-term loan (i.e. ‘term’ loan), depending on business needs.