PRIVATE FINANCE FOR
Hotels
Are you considering buying or remortgaging a hotel?
Are you considering buying or remortgaging a hotel?
We handle over £300 millions of real estate enquiries every month, from
castles in France, to private islands to mansions in the UK. Give us a call today
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Years of Experience
Making the impossible possible is how we have created many solutions for private clients. Financing a luxury real estate can be complicated but we can make this process as simple as possible.
Securing a Mortgage for a Hotel Purchase or Remortgage
Are you considering buying or remortgaging a hotel? Securing finance for such a substantial investment requires a tailored approach. At Million Plus Private Finance, we specialise in providing bespoke mortgage solutions designed to meet your specific needs.
What Type of Mortgage Do You Need to Buy a Hotel?
To purchase a hotel, you’ll require a commercial mortgage. Fortunately, there are numerous lenders willing to finance hotel acquisitions, accommodating various circumstances.
Commercial mortgage deposit requirements are typically higher than those for residential home loans due to increased risk. Expect to provide at least a 25% deposit, with a maximum Loan to Value (LTV) of 60% being common for hotel mortgages.
What If You Have No Money for a Deposit?
If you’re unable to provide a 25% deposit then it may be possible to secure you a mortgage with a higher LTV or even a 100% hotel mortgage, should you have other assets which can secure the loan.
Commercial hotel mortgages are evaluated on a case-by-case basis, focusing on business plans and financial projections rather than personal finances, unlike residential mortgages.
Which Lenders Offer These Mortgages and at What Rate?
Interest rates vary depending on your circumstances and the lender. Rates typically range from 2% to 6% above the Bank of England base rate.
- Strong Applications: Low LTVs and strong business track records can secure lower rates from mainstream lenders.
- Higher LTV Requirements: Specialist commercial lenders may accept higher rates for under-performing hotels or inexperienced owners.
Larger loan amounts can provide more options and potentially lower rates, as smaller hotel mortgages often attract higher interest rates due to fewer lenders considering them viable.
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Interest-Only Commercial Mortgages
Interest-only commercial mortgages offer lower initial monthly payments, beneficial for cash flow during initial hotel operations or renovations.
How to Get a Hotel Mortgage
Turning your hotel ownership dream into reality or expanding your existing portfolio involves several key steps:
- 1. Prepare Your Business Case: Evidence of the hotel’s potential success is crucial, including business plans, occupancy rates, financial projections, and location advantages.
- 2. Check Your Credit File: Ensure your credit history is accurate and addresses any issues that may affect your application.
Eligibility Criteria
Successful applications hinge on a robust business case and factors such as:
- Industry Experience: Demonstrable success in managing hotels or related businesses enhances your application.
- Occupancy Rates: For existing hotels, current revenues per available room (RevPAR) and average daily rates (ADR) are key considerations.
- Location: Proximity to tourist attractions and amenities can boost your application's appeal to lenders.
Why Choose Million Plus Private Finance?
- Tailored Solutions: We provide customised mortgage solutions designed to meet your hotel financing needs.
- Global Network: Access to a diverse range of financing options through our extensive network of over 200 lenders.
- Direct Access to Decision-Makers: Our relationships with finance institution decision-makers ensure prompt and accurate feedback on your case.
- Tailored Solutions: We offer fully customised solutions, including manual underwriting, to match your unique requirements.
If you’re ready to explore how Million Plus Private Finance can assist you in securing the ideal mortgage for your hotel purchase or remortgage, contact us today. We look forward to discussing your goals and helping you achieve them.
Million Plus Private Finance
YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT
Changes in the exchange rate may increase the sterling equivalent of your debt. The Financial Conduct Authority does not regulate finance, foreign currency mortgages, bridging finance, secured loans, and some aspects of commercial mortgages. You may have to pay an early repayment charge to your existing lender if you re-mortgage.
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