Pub mortgages with accommodation. Understand the whole business.

Property investment or trading business?

Explain whether you are buying a property leased to a pub operator or acquiring and running the business yourself. The value of the property and the performance of the business are related but distinct.

List exactly what is included: land, buildings, business assets, goodwill or stock. Avoid presenting a business purchase price as though it were a property valuation.

What is the accommodation used for?

A manager’s residence, short-stay letting rooms and an independently let flat should be identified separately. Record who occupies each area, on what terms and with what access. The marketing description “pub with rooms” is not enough to decide a finance category.

Prepare a complete operating picture

For a trading proposal, prepare the available accounts and a clear explanation of how the business will operate after purchase. For an investment, provide the operator’s lease and the rental position. Lender appetite is individual; a mixed-use label does not guarantee acceptance.

• Breakdown of the purchase price and assets included.
• Business accounts or the occupational lease, as applicable.
• Accommodation schedule and intended occupants.
• Licensing, use and material property issues for legal review.
• Deposit, improvement budget and working capital needs.

Get the regulatory route right first

Tell us if the accommodation is intended as your home or a relative’s home. We are not FCA regulated and do not arrange regulated lending. If regulated funding is required, the enquiry will be referred to an FCA-regulated counterparty.

What does a pub mortgage need to take into account?

A pub mortgage proposal should explain whether it concerns a property investment, an operating business or both. For an investment, identify the operator and the occupational lease. For an owner-operated pub, set out the available trading accounts, the proposed business model and working capital. The building’s accommodation may contribute rent, room revenue or no independent income at all, depending on its use.

A sale price may include goodwill, stock, fixtures or equipment as well as the property. Keep those elements separate. A commercial mortgage secured on the building should not be assumed to fund every part of a business acquisition. Explain the requested loan, deposit and other sources of finance against a complete uses-of-funds schedule.

How do guest rooms differ from a separately let flat?

Guest accommodation usually forms part of a trading operation, while an independently let dwelling has its own occupation arrangement. A manager’s flat can be linked to the pub’s operation, and a home intended for the borrower or a relative raises a separate regulatory question. Describe the actual arrangement rather than treating every bedroom as residential rental income.

If forecasts include room revenue, identify the assumptions for occupancy, pricing, staffing and costs. Do not present projected turnover as net income available for mortgage repayments. For existing operations, the accounts and current information should explain what has actually been achieved. The lender will assess the layout and use of the accommodation.

What property and business costs belong in the budget?

Allow for transaction costs, essential repairs, insurance and working capital alongside the purchase contribution. Explain licensing and use matters requiring legal review, and disclose known property issues. Business cash flow may vary through the year, so a single strong trading month should not be used as a substitute for a considered annual budget.

Compare borrowing terms over the period relevant to your ownership plan. Include interest, arrangement fees, repayment structure and any early repayment charges. The lowest opening rate is not necessarily the lowest overall cost. If refurbishment or a change in operation is planned, distinguish the current business from the proposed future business and explain how costs will be funded during the transition.

What is the next step for a pub-finance enquiry?

Provide the address, particulars, purchase-price breakdown, deposit, required loan and intended operating arrangement. Explain who will occupy the accommodation and whether a third-party operator will lease the premises. Available accounts, the lease and the accommodation schedule may be requested later through an appropriate document-sharing method.

We only deal with non-regulated finance. Lenzie Consulting Ltd is not authorised or regulated by the FCA, and regulated requirements are referred to an FCA-regulated counterparty. An enquiry does not establish product availability, business viability, a valuation or approval. A clear explanation of the actual proposal is the best starting point for determining the next information required.

Common questions