Commercial Mortgages for Care Homes

A care home is valued on what it earns, not what it cost to build. Healthcare valuers use an EBITDA multiple or profits-based method: they look at fee income (and critically, the split between private and local-authority-funded residents), occupancy rate, staffing costs, and the capital expenditure required to keep the property at CQC standards. That is why the high street has almost nothing to offer here. The lender who says yes to a care home acquisition is usually a specialist healthcare lender or a challenger bank with a dedicated healthcare desk, not a clearing bank.

LTV on a care home mortgage typically sits at 65-70% of the specialist healthcare valuation, which is itself lower than the open-market value if the home stopped trading. That gap matters: a 25-bed home generating £1.2M in fees might support a very different loan than the land and building alone would suggest, in either direction depending on occupancy and margin.

Your CQC rating is underwritten as hard as your accounts. A "Good" or "Outstanding" rating opens the panel. "Requires Improvement" narrows it. "Inadequate" tends to close it until the rating is addressed, and no broker can change that. Lenders also want the registered manager and at least one director to carry relevant sector experience and qualifications; first-time operators without a healthcare background will find the market close to impossible regardless of deposit size. We match your rating, fee mix, and operator experience against the lenders whose appetite actually fits, so you are not paying for a valuation a lender was never going to fund.