Queries about buying a leasehold business
I have a load of questions which I hope you can help answer. Please excuse my ignorance for the questions I’m about to ask, but I’ve never bought a business before and I’m not too sure on a few things. I’m really confident about running it, it’s getting it that concerns me more!
I’m about to make an offer on the lease of a newsagents/off licence and I’ve an array of questions for you. I would appreciate any advice/comments/ideas.
I’ve had the go ahead from my current mortgage company to increase my mortgage by enough to buy the lease and stock, so my first question is, does this sound like the right thing to do?
The shop comes with a flat, which I intend to live in and I’ll therefore rent my house out (as they’re 100 miles apart). After rent, I’ll be about £200 short on the new mortgage payments, which I’m not too worried about as I won’t have any costs with living above the shop. The annual rent on the shop and accommodation is given as one figure and I am wondering if there are will be any tax or other implications as I assume the rent will be coming out of my profits, so in effect we won’t be paying anything for our living accommodation, or am I wrong?
Next question…..(sorry)……Will my mortgage company have a problem with me renting my house (as I don’t have a buy to let mortgage)?
And another one…….The lease has 8 years remaining. If I decide to sell up after five years, will I have any problems selling on with only three years remaining? Would I be better off renewing the lease? And in five years would the money I paid for the eight year lease have depreciated because there’s not so long on the lease or is it based on turnover?
Finally…….the stock is valued at £8,000 approx. Would this be negotiable? Do I have to buy the stock? Can I only buy what I want? I want to keep the shop much the same, except for increase the off-licence side of it and decrease the grocery side of it.
Many thanks in advance.