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  • Created by: geogt002
  • Created on: 06-06-16 16:25

mortgage benifits

a bank lender is likely to lend af the full amount so they can obtain the funds needed to build quickly.

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drawbacks of a mortgae

-mortgage repayments are paid back with interest. intrest is a cost to the businesses so will therfore reduce profits. this is especially impotant as they have already got a lot of intrest and rates are forcast to increase.

-a mortgae would tie af down to a long term debt of 25-40 years. if they wanted to move in this perod, something that they are currently condiering, they would have to sell the fscory to repay the mortgae. prperty prices can flucoate. if the value of the facotry fall then af could end up loosing money on the purchase.

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benefits of renting...

-this means that af will not own the property but likewise will not have the dent invloed with a mortgae need to purchase the proerty.

-renting a property means they could move in sooner.

-renting a facotry would mean that af could dcide to relocate again in a few years time ad move production to swenden easier.

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drawbacks of renting...

-af will not own the facotry. this means that thier landlord will have the final say with what they do with the facotry and could ask them to mve out at any time so it could be risky (when the lease agreemnt is up) not stable or secure enough?

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