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Good afternoon all
A few examples follow which may assist in seeing whether there is opportunity from a resi broker's point of view, recognising that all of the following individuals, given "complex" or self employed incomes use a residential broker to arrange their domestic mortgages / life insurance but have lots happening in the businesses that they run that carry a requirement for business debt of some description....
1. Children's Day Care Nursery - £150K unsecured business loan over a 72 month term to fund expansion into second premises and repurpose part of the company's freehold to accommodate extra places. Challenging financials during and post Covid, but eight working days from introduction to completion. Gross income: £595 fee and £4500 commission. Life insurance review for the business owner and keyman on nursery manager
2. Convenience store - £27K unsecured loan over a 24 month term to enable part of the shop to be restructured and refitted including new refrigeration. Weakish personal profile and neutral financials. 48 hours from introduction to drawdown. Gross income: £1350 commission. Lender offers top ups after 4 to 6 months with commission paid on any subsequent draw for the first 12 months so additional income likely to follow as significant percentage of clients top up at least once
3. Logistics - £225K revolving credit facility to help manage cashflow peaks and troughs as bank refusing to assist with an overdraft. 24 month review, limit expandable as business grows. Six working days from introduction to facility going live . Gross income fee £2250, commission payable monthly driven by utilisation for life of relationship with lender - forecast monthly commission if fairly fully used £200 so further year 1 income of £2400. Life insurance review for both directors.
4. Domiciliary Care - £50K unsecured loan over 36 months to enable purchase of trading business for first time business owner. Decent financials for the target but limited experience for applicant whose stake and asset base were also fairly restricted. Seven weeks from introduction to funding due in part to business plan needing to be drafted then reworked. Gross income £2000 fee £1000 commission. A spot factoring arrangement to ensure smooth cashflow going forward is also being put in place which will generate a small residual monthly income. Again, life and personal guarantee insurance review for the new owner.
I’d be interested to know if this sounds of interest.
Geoff