Advice re Business loans

macduf

I am looking at a Snooker club that is for sale. Is it possible to borrow the full amount to purchase the Business?

jonesMUFCforever

In today's climate no.
Do you have experience of running a business?

Do you have any security to offer a lender?

What would you get for your money - a building perhaps with a few tables (Leasehold or Freehold?) with or without a drinks licence. If it has a licence do you qualify for it to be transferred to you?

How much money does it generate per week/month/annum - is this enough to pay you a wage, pay your bills and taxes and a 100% mortgage/loan.?

Why is it for sale?

As you can see a lot of questions which you need to consider.

macduf

Thanks for your reply.
I have experience of running a business, also sales and customer faced.
There would be no security from myself but the business is freehold and the Land is probably worth more.
I would train up and get the drinks license.
I have not viewed the accounts I but I know all about the club I was wondering what position I was in to be able to purchase it.
It requires a new owner to improve things even though generally every club is on a downer due to the current climate and the smoking ban.

jonesMUFCforever

In this day and age no security no loan!
How much will you need to purchase this?

If you don't mind me saying ''I have not viewed the accounts but I know all about the club'' does not sound a very professional approach to me.

This is the first thing I would have looked at before anything else.

macduf

The club side of things are fine.
If the Land/Premises were worth a lot more than the loan would they not take that into account?
What sort of % deposit on average would be required if they insisted on one?

loveandlight

I have been going through exactly this situation (not with a snooker club though) for the past several months. It is not as easy as it is made out and I have learnt a lot in the process.

You have the advantage of the commercial land and freehold property to offer as security. Lenders definitely will like you to put up some kind of your own money as well otherwise they feel they are taking all the risk and you are risking nothing.

Get yourself a good commercial finance broker and make sure they are a member of the national association of commercial finance brokers. You can google for their website as they are easily found.

From their website you will get a list of brokers in your area. Shop around on the phone and get some free advice. That way you will get the general gist of your chances of getting a loan and it will help you decide who you feel the most comfortable with. Whatever you do, don't pay them an upfront fee. Most good brokers get paid by the lender which means you are paying their fees indirectly as it gets added onto the loan.

I definitely agree with ejones999. You simply must get the accounts looked at first. Not just by you but by your accountant. I did this first and made sure I had the green light in writing from my accountant before I even applied for a commercial loan.