Commercial mortage or loan

[ianmiller]

Hello all, basically have £30k deposit available to set up a campsite in France. Land and property we have seen is worth 80000 Euros. What is the story with French commercial mortages? Have been unable to find a great deal regarding them on the internet, how much is the max you can borrow. Can you get 100% commercial mortages (prob not), can anyone recommend a good lender and somewhere I can get more info.

[Panda]

Hello

I found the CIC were good at making a quick decision on applications BUT unless your 'campsite' for 80k has an income already which can be proved or you have a 'provable' and ongoing income of which 30% can be used for mortgage repayments you may struggle to get a loan at all these days.  A business plan might do it if done well but these days all loans are difficult with a sniff of risk they are impossible.

P

[LEO]

Hi Ian ,

from what you have said, you are miles away from realising your campsite. You would need 30,0000 euros after you have purchased the house !

sorry to be so blunt/accurate.

Kind regards and best wishes,

Leo

[ianmiller]

Thanks for the info!

Say do you or anyone else know if gites are classed as buy to let when it comes to mortages or commercial in the eyes of uk banks.

[PaulT]

Ian

Hope I am wrong but reading your post it says to me that you are rushing in without much thought looking for a commercial venture.

As Leo says you will need money to start with - most businesses on start up run at a loss.

With a campsite you may need to build up the business. Even with an established business with a lot of people regularly returning they might not like the new owners and go elsewhere.

If you read the section on this forum about gites you will find that a number of areas have over capacity and therefore there could be fewer bookings.

Do draw up a robust sensible business plan, carry out the research and make sure that there is a high probability of it succeeding. If it looks negative drop the idea.

Paul

[Will]

There seems to be a rule quoted on forums like this, usually by those with some experience of doing it, that if you need to borrow money in order to run gites or B&B in France you are unlikely to succeed. I would imagine the same would apply to camp sites.

I'm not saying 100% mortgages are impossible, but they have always been very uncommon and difficult to obtain in France, and under the present circumstances things are hardly likely to have eased. You need to forget the banks if a high percentage loan is what you want and find a specialist mortgage broker. Another important consideration is that French lenders tend not to loan according to a value of the mortgaged property, or other collateral, but on your ability to pay back the loan. They need to be satisfied that you have a steady income, and that  repayments for all your loans (not just the mortgage) will amount to no more than a third of your income. A business plan may demonstrate this, but I think you will need more than just a business income to satisfy this requirement. A broker may be able to find a lender that works differently, but it won't be easy.