Pension Led Funding
Unlock the potential in your pension.
The perception about pensions is that you can’t utilise the funds until you retire, however for certain pension schemes this is not the case.
If you have a qualifying pension scheme you may be able to utilise its value to support your business or to purchase a commercial property.
Pension funding is highly regulated and you need the correct advice, however you can use the funds in your pension through two main tools.
This is where your pension lends your business or a third party business a sum of money for up to 5 years. The borrowing entity will pay a commercial rate of interest back to the pension scheme and will also offer security to the pension which is agreeable to the pension trustees.
Commercial Property Purchase:
With a qualifying pensions you can leverage 50% of the value of your pension to support a commercial property purchase, either for your business to occupy or as an investment purchase.
The pensions trustees will have the ultimate say over whether they are happy with the terms of any loan back or commercial property purchase.
Pension Led Funding FAQs
How long Can I borrow for?
A commercial property purchase can be funded up to the lender’s maximum term which is 30 years with some lenders. If you are doing a ‘loan back’ this is usually capped at 5 years.
Will I need to give security?
Yes. If is it a commercial property purchase the pension will own the property, which in essence is the security they need. If you are arranging a loan back, you will need to provide security. It is up to the pension trustees on what they are prepared to accept. Debenture, guarantees, property etc could all be considered.
How much can I borrow?
This is determined by the value of the pensions fund. You can leverage up to 50% of the value of you qualifying pension fund.
Why work with us?
We have worked with many clients to assist them in utilising their pension funds for growing their business. With a strong panel of lenders who understand pension based lending and many years’ experience in working with pension trustees and IFAs we know what everyone needs to make a transaction work, reducing the complexity of these type of transactions. We will always work alongside you financial advisor to make sure that the borrowing solution fits in the with the advice that you have received.