Background – The client’s situation before ASC became involved
Our client, a pub owner struggling with rising mortgage repayment costs, was introduced to us by a residential mortgage broker. As the loan was becoming unaffordable, they needed help restructuring the debt, but they’d lost confidence in their original broker.
Challenges – Rising costs and a misleading loan agreement
A few years ago, our client had sourced finance to buy the freehold of their pub via a commercial finance broker who was one of their customers. They thought they’d taken out a repayment mortgage on a fixed rate. However, they hadn’t read the small print, and the mortgage was actually interest-only on a variable rate, with a fixed margin over the base rate. With the base rate increasing, their monthly payments were rising and becoming more challenging to cover. Luckily, they then spoke to Alister at ASC Kent.
Solution – How ASC helped restructure the client’s finances
We met with the clients to understand their situation and ease their concerns about using a broker again. With a full brief, we researched the market and found a suitable repayment mortgage that was actually cheaper than their interest-only arrangement.
We managed the entire remortgage process on behalf of our client to ensure a smooth transaction and avoid them being let down for a second time.
Outcome – A stronger financial future for the business
Our client now pays less per month despite reducing the loan capital with a repayment mortgage! As well as paying off their loan, this situation has strengthened their cashflow and put them in a more stable financial position – a welcome scenario given the unpredictable nature of the hospitality sector.
We were delighted to be able to help our client out of a tricky financial situation and have this note of caution – avoid taking financial advice from your mate at the pub!
