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The Right Package |
Generally banks require a deposit of between 25-30% of the purchase price, however, this could be in the form of additional security. When you speak to our business adviser he will be able to assess your situation and advise you on whether additional assets can be used in this way.
Outside income can also be considered, so, if one partner intends running the kennel or cattery while the other continues in their present job, this will be taken into consideration.
Please remember that, in most business purchases, the total purchase price is unlikely to be the freehold value of the property.
In most cases the freehold purchase price of a kennel or cattery will comprise of freehold property, goodwill, fixtures and fittings, kennel or cattery buildings and possibly stock (see our example case study below).
Mr and Mrs N …. wished to purchase a kennel and cattery.
They were selling their house which would give them £102,000 as a deposit for their purchase. They found a kennels with a purchase price of £325,000, plus stock and expenses (stamp duty etc.), which gave a total purchase price of £355,000. Actual freehold property valued at £250,000 - the purchase price of £355,000 being made up of freehold property value, goodwill, kennel buildings, fixtures and fittings and stock.
A loan of £255,000 was obtained through Kennel Finance for Mr and Mrs N., through a high street lender. This loan represented over 100% of the freehold bricks and mortar valuation of £250,000. |
Proving that age is no barrier … Mr and Mrs D recently purchased their first kennel after they retired. They had paid off their residential mortgage over ten years ago and, bored in retirement, Mr D (aged 63) and Mrs D (aged 60) purchased their business after selling the house and using the proceeds as a deposit to purchase a kennels.
A £200,000 mortgage was required which we were able to arrange over a period of 15 years. Mr and Mrs D were fit and healthy and wanted a lifestyle business. They are looking to pay the mortgage in under ten years which will given them more money when they decide they eventually really do want to retire! |
Mr and Mrs L …. viewed a kennel and cattery that they wished to purchase. Unfortunately the kennels had been closed for some time and so the kennel block and the house needed complete refurbishment. Mr and Mrs L realised that the only option was to completely renew the kennel and cattery buildings and to modernize the house. This would mean six months further closure of the business.
Kennel Finance were able to arrange a mortgage to purchase the property plus the cost of rebuilding and refurbishing as necessary, in additional to further working capital for the business when re-opening. Kennel Finance negotiated arrangements for a capital repayment holiday during this period. |
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