Atom bank delivers £640k commercial mortgage for FTB care home provider overlooked by high street banks

15 November 2024

Atom bank has completed a £640,000 commercial mortgage for a care home provider with exceptional credentials, but who was let down by a number of high street lenders because of their first-time buyer (FTB) status.

The borrower has a strong background in the care home sector, having worked with the Care Quality Commission (CQC) to help turn around businesses that were underperforming. After helping their previous employer to improve the profitability of four care homes, the owners of the borrower wanted to start their own business by acquiring and improving already established underperforming care homes.

They turned to broker Paul Mak, managing director of Pomegranate Commercial Finance, who presented the deal to a host of lenders, including high street banks.

However, Atom bank stood out because of its appetite and commitment to the sector, willingness to consider goodwill and focus on the borrower’s experience. By contrast, rival lenders were unable to look beyond the fact the care home being purchased had a ‘Requires Improvement’ status from the CQC, or the fact that the borrower was technically a first-time buyer, despite the owners’ extensive experience in the care home market.

Atom bank was able to deliver for the client, providing a £642,000 commercial mortgage at a fixed rate over a five year term, and at a loan-to-value of 71%.

Paul Mak, Managing Director of Pomegranate Commercial Finance, commented:

“I am a big fan of Atom bank, its sensible criteria and approach to lending. While high street banks often focus on larger facilities, Atom bank is much more flexible in this sector, judging cases on their individual merits and delivering genuine support to smaller care home providers.

“In this instance, the fact that the owners of the borrower had such comprehensive experience in the industry meant it was a prime opportunity, and they were so pleased with the service that they are already planning to use Atom bank again for further purchases.”

Karen McGrath, Regional BDM for Atom bank, added:

“This case is a prime example of how Atom bank is doing things differently and providing valuable support to both existing established businesses that are being sold and new owners in a vital sector. Too often viable care homes are held back by the overly prescriptive attitude of lenders, but Atom bank is committed to delivering for underserved businesses, such as first-time buyers and going concern businesses.

“It’s also testament to the value of strong relationships. We have worked closely with Paul on a host of cases in the past, so he has a great understanding of our approach, criteria and determination to support small businesses in both the care home and all SME sectors. He knew that we could deliver for his clients who may have been overlooked elsewhere, and we did just that.

“The fact that the client wants to use us for future purchases speaks volumes and shows that Atom bank is bringing positive change to the commercial market, in care homes and beyond.”