This is based on the serviceability of the business. General rule of thumb is, that if you purchased a practice under £500k we would expect the deposit to be approximately 10%, over £500k - 20% and it can be up to 30% for a Private practice. However, this is not a hard and fast rule, and for the right practice and the right situation, a lender may offer 100% lending if there is enough security to support in the background. It is also worth bearing in mind that if the business is strong enough to sustain the debt of the freehold, we can normally secure this element of the loan at 100%.
Here’s a guideline that in our experience, we’ve found to be consistent.
•NHS/Mixed:
<£500K – 10% Contribution
>£500K – 20% Contribution
•Fully Private:
Any Value - 10-25% Contribution
Your deposit could potentially be a blend of cash and security, providing you have property with enough lending value available for a second charge.
In theory, with enough security, you could reduce your cash input to 0%, allowing you to borrow with 100% lending.