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Healthcare Finance for GP’s
Banks have always been comfortable in lending up to 80% of the freehold premises value and a good number are comfortable with lending up to 100%.
- Buy in / by out loans
Generally 100% LTV – significant stand alone unsecured funding.
- Freehold surgery premises partnership loans
Freehold surgery premises partnership loans 100% LTV not unusual with most lenders comfortable in arranging individual partners funding within a joint and several liability partnership facility. This is often asked for when partners want to overpay “their share” of a premises loan. Having said this lenders prefer a straightforward one loan partnership facility
- Freehold premises Propco
100% LTV where the partners buy the premises through a property company. Lease will be required between practice and propco. Bank may / may not ask for personal unsupported guarantees from partners to cover the “unsecured” funding ie between 70% and 100% of property value.
- New build development finance GP surgery and of medical centre
100% LTV possibly up to 105% and possibly as high as 110% loan to cost.
- Medical centre development finance
100% LTV, possibly up to 105% loan to cost. This includes surgery premises and generally a pharmacy but can also include private hospital with consulting rooms for medical consultants CQC staff and others.
- Property extension / upgrade
Finance available up to 100%.
- Premises refinance
Up to 100% LTV – Some capital can be released to partners to but bank would need to be happy for reasons eg school fees or pension payments for private work.
An important feature will be the amount of notional rent – which for many lenders, is the driving force for serviceability calculation. Lenders will also take account of any other “guaranteed” long term rent ie from a pharmacy, private hospital or dentist subject to long term leases being put in place.