Business loan to buy and run a B&B - no idea where to start

jonnytekno

Hi there,

I have had the initial kernal of an idea to try and buy and run a local B&B business which has come on the market.

I work full time and have a good salary. My wife doesn't work so would run it all. It's already a successful business so it's really just a case of buying the property and taking it over, although we would probably want to do renovation to it as well in order to put up the rates.

Here is the part that might get me laughed out of the forum - we have zero capital for the deposit on the mortgage. My question is whether there is any way of us getting a business loan or even any kind of capital from an investor in order to front the deposit and any cash to get started, or is that literally insane?

I actually work in the hotel industry on the commercial side so I know a lot about how to make a business like that work, and my wife is an interior designer normally but a full time mum at the moment.

Any ideas? I know nothing about trying to raise finance like this.

[Deleted User]

Without making any contribution of your own money, you're going to need to find yourself a Dragon.

BoGoF

Ball park figure as to how much this will be?

meer53

How old are your children ? Full time Mum and running a B & B are two jobs. How does your wife feel about her role in the B & B ?

DCFC79

Just a couple of points, you kention about raising the rates, I take it you have looked into if you could even get the new rates.

Im not sure its easy as taking it over, you say you work in the hotel industry on the commercial side, any actual experience of running a hotel, dealing with staff.

boo_star

Deleted_User wrote: »

Without making any contribution of your own money, you're going to need to find yourself a Dragon.

I think the dragons would run a mile when they find out the OP doesn’t have any skin in the game

[Deleted User]

OP your only option would be a business loan from a bank and you would need a) a business plan b) at least 50% of the required capital.
Without both of these then I'm afraid you will have to forget it.

Richey_

Harsh answers in my opinion

OP how much equity do you have in your own home? Realistically you would need to put the on the line for a bank to invest in your business to be viable. How much homework have you done re other costs involved in this as a business?

BrassicWoman

or sell your house and live in the B&B

Brock_and_Roll

FWW I am a (live in) B&B owner. Just to clear things up, there is absolutely zero chance of getting a commercial mortgage to purchase a B&B without at least a 20% deposit.


We purchased our property as a going concern, moved in and had guests there very next day as well as a live in lodger who went to work under one owner and came home to someone new! Luckily he was and is a most excellent chap! So it is a big dive into the unknown and very stressful - my wife (who also had small children) was often in tears. But we got through it and the business was successful - albeit one of the hardest ways imaginable to make a small amount of money! People have no idea how much hard work it is to strip and clean rooms each day, do all the washing, ironing, cooking etc never mind all the fruitless waiting in for guests to arrive or leave. Luckily to clear minimum wage if you factor all this in!!!


We were also on a standard residential mortgage (but got proper commercial insurance).

[Deleted User]

Richey_ wrote: »

Harsh answers in my opinion

OP how much equity do you have in your own home? Realistically you would need to put the on the line for a bank to invest in your business to be viable. How much homework have you done re other costs involved in this as a business?

Personally I don't think the answers are harsh, would you really advise someone to put their family home on the line to invest in a business in which they have no experience.?
Home work regarding cost etc would all be part of a business plan.