Bed and Breakfast Network Blog

Rates are low but may not be for much longer… Interest rates seem to have hit bottom, but many experts express concern over the future of our economy and the impact market conditions will have on long-term interest rates.  Innkeepers wishing to reorganize debt, make capital improvements or refinance a loan that is ballooning or adjusting would be well advised to begin the application process in the early part of 2010.

Thinking of selling anytime soon?

If your exit horizon is within the next few years, and you want to do all you can to enhance the value of your inn and make it more attractive to potential buyers, here are a few ideas to consider according to Rick Newman, Managing Partner of Commercial Capital Network:.

• Refinance now into an assumable mortgage* while rates are low!
• Be in a position to offer a potential buyer a 5.25% to 6.25% assumable mortgage
• Increase your loan to fund improvements that will make your inn more attractive to potential buyers
• Access capital to expand guest rooms/facilities and increase revenue/NOI

Refinance into a loan that is large enough to make it attractive to a potential buyer.  The loan should be of an appropriate size relative to its net income before debt service, yet large enough to make it attractive to a buyer.  Remember, a buyer’s down payment may limit his or her ability to use the assumable provision without a seller-held second mortgage to make up the difference between the sales price/appraised value and their down payment.

You may call Rick at 570-595-2120 or

E-mail him at: ccnllc@gmail.com Website  www.bedandbreakfastfinancing.com

Other Articles You Might Enjoy:

1. Selling Your Bed and Breakfast Part 2
2. So you Want to Buy a Bed and Breakfast Inn
3. Owning a Bed and Breakfast Inn in Arkansas
4. Selling Your Bed and Breakfast (Part 1)
5. Advertising Your Bed and Breakfast Inn