The Brexit vote has had an immediate and dramatic effect on the UK’s credit rating and the value of Sterling. The UK is now seen as a less safe place to invest in and less secure to lend money to.
PFM Dental Director, Jon Drysdale, says: “The decision to leave the EU could affect your plans to purchase a dental practice and makes it even more vital to have a robust business plan. Lenders will undoubtedly pass on the increased costs of borrowing although against this it unlikely the Bank of England will impose an interest rate rise.”
The UK remains one of the world’s largest and strongest economies with good banking liquidity, relatively low unemployment and perhaps the potential for improved terms with global export markets. If you subscribe to this view, the cost of borrowing money will probably stabilise and remain at a reasonable rate.
All of this emphasises the need for buyers to examine their business plan and the cost of running a business. Are you being realistic about the interest rate you can achieve? Do your projections stress test for rise in the cost of borrowing?
For more information about PFM Dental services go to: http://pfmdental.co.uk