Quick answer / TL;DR

Yes — it’s often possible for restaurants and catering businesses to combine several loans into a single refinance facility. Lenders will assess the types of debt (secured vs unsecured), cashflow, trading history and any existing security or hire-purchase agreements. Consolidation can lower monthly payments and reduce admin, but may lengthen the term, increase overall interest, and involve arrangement or exit fees. Start with a free eligibility check to understand likely outcomes.

Get Quote Now — Free Eligibility Check

We’re an introducer — not a lender or regulated adviser. Offers are subject to lender eligibility checks.

Why restaurants & caterers refinance — when consolidation makes sense

Hospitality businesses typically juggle a mix of finance: an overdraft for day-to-day cashflow, asset finance for kitchen equipment and vehicles, term loans for expansion or site acquisition, and sometimes merchant cash advances or short-term bridging finance. Managing multiple repayments, different lenders and varying rates can chew into margins and distract owners from operations.

Consolidation becomes attractive when:

• Monthly interest and repayment dates are causing cashflow pressure.
• Short-term, high-cost facilities (merchant cash advances, some bridging loans) are squeezing margins.
• You want to simplify admin and reporting across multiple sites.
• You plan a refurbishment, expansion or equipment upgrade and want predictable repayments.

Bear in mind: lower monthly payments do not always mean cheaper overall — extending a loan term can raise lifetime interest. Speak to brokers to compare the total cost of credit, not just the monthly repayment.

Which loan types can be combined?

Lenders and brokers commonly consolidate the following facilities, depending on circumstances:

• Business term loans — secured and unsecured term loans are frequently refinanced into a single loan.
• Business overdrafts & credit cards — often converted into term debt to stabilise cashflow.
• Asset finance and equipment loans — some providers will refinance equipment finance, or you can repackage through asset refinance.
• Merchant cash advances (MCAs) — high-cost advances can sometimes be refinanced but may need proof of improved cashflow.
• Invoice finance — rarely rolled into standard term loans; often retained or renegotiated separately.
• Commercial mortgages — property refinance is normally handled separately but can be part of a wider restructure in some cases.

Practical note: hire-purchase agreements and fixed-asset security tied to a specific asset often need bespoke handling — the lender may require the asset to remain secured or insist on full settlement before consolidation.

What lenders and brokers look for

When assessing consolidation, lenders and specialist brokers typically evaluate:

• Cashflow and trading performance: 6–24 months of management accounts and bank statements to confirm affordability.
• Profitability and projections: realistic forecasts showing the business can meet repayments after consolidation.
• Type and security of existing debts: whether loans are secured against property or assets; redemption figures are required.
• Ownership and lease arrangements: site leases, break clauses and rent levels, especially for multi-site operators.
• Personal guarantees and director credit profiles: these affect terms and speed of approval.

Typical documents requested: 12–24 months accounts, up-to-date management accounts, recent bank statements, VAT returns, lease or title documentation and a schedule of existing liabilities (amounts, lenders, repayment terms, early repayment charges).

Common refinance structures for the hospitality sector

Several structures are used to consolidate hospitality debts:

• Single term loan: Converts multiple debts into one monthly repayment. Pros: predictable. Cons: may lengthen term.
• Asset-backed refinance: Uses property or equipment as security to access lower rates or higher borrowing limits.
• Blended/hybrid facility: Part-term loan to clear historic high-cost debts with retained invoice or asset finance for specific assets.
• Revolving credit facility: For businesses that need flexible working capital; more flexible but sometimes costlier than term debt.

Illustrative example: a two-site caterer refinanced an overdraft, two term loans and a merchant cash advance into a 5-year term facility. Monthly payments fell, stabilising cashflow, but total interest rose — acceptable because it avoided insolvency risk and funded a planned refurbishment.

Costs, timescales and hidden considerations

Costs to expect:

• Arrangement fees (1–3% typical)
• Early repayment charges or exit fees on existing facilities
• Legal fees and asset valuations
• Possible increased security or guarantor requirements

Timescales:

• Initial eligibility check & broker match: typically within 24–72 hours
• Indicative offers: 1–7 days
• Full due diligence and completion: 2–8 weeks (complex cases longer)

Quick worked example: consolidating £150,000 of short-term, high-rate debt (average 18% APR) into a 5‑year term loan at 9% APR reduces monthly payments from £4,250 to £3,106 but increases lifetime interest costs. Always compare monthly savings with total cost of credit.

Tax note: interest on business loans is generally deductible, but check with your accountant for specifics.

Step-by-step: how to combine multiple loans

1. List all liabilities — lender, balance, rate, term, security and early repayment charges.
2. Gather documents — accounts, management accounts, bank statements, lease/title, asset schedules.
3. Get a free eligibility check — submit basic details so brokers can match you to suitable lenders. Get Quote Now — Free Eligibility Check
4. Compare indicative offers — focus on total cost of credit, fees and covenants, not just monthly payments.
5. Proceed to formal application — due diligence, valuations and legal work follow.
6. Complete refinance — new facility settles old debts and you begin repayments under the new terms.

Practical tips: request redemption figures from existing lenders; ask potential lenders for a breakdown of arrangement and legal fees; ensure contingency funds cover the refinance timescale.

Start Your Enquiry — Free Eligibility Check

Risks & when consolidation may not be right

Consolidation isn’t always the best option. Consider these risks:

• Higher total interest: reducing monthly payments by extending the term increases lifetime cost.
• Loss of flexibility: overdrafts offer variable access; moving to fixed term debt can reduce short-term flexibility.
• Security & personal guarantees: lenders may require additional security or guarantees, increasing personal risk.
• Behavioural risk: consolidation may free up capacity that is then used for new borrowing without fixing the root cause of cashflow problems.

If your high-cost debts are short-term and you have a confirmed pending increase in revenue (seasonal peak, holiday trade, one-off contract), it may be better to ride them out rather than refinance into longer-term debt.

How UK Business Loans helps

UK Business Loans connects restaurants and catering businesses to trusted brokers and lenders who understand hospitality. We offer a quick, free eligibility check — we’re not a lender and we don’t provide regulated advice. Submit a short enquiry and we’ll match you to partners who can provide indicative refinance options quickly.

Benefits of using our service:

• Fast matching to sector specialists
• Compare multiple indicative offers without multiple applications
• No obligation to proceed; submitting an enquiry won’t affect your credit score

Get Quote Now — Free Eligibility Check

For more reading on restructuring and options, see our guide to refinance loans.

Frequently asked questions

Can I refinance if I have a poor credit score?

Possibly. Some specialist lenders and brokers work with businesses with impaired histories, but terms may be stricter and rates higher. A broker can identify lenders most likely to consider your case.

Will refinancing affect personal guarantees?

Existing personal guarantees may need to be discharged or replaced. New lenders often require updated guarantees; get legal advice before signing.

Can hire-purchase or HP agreements be included in consolidation?

Sometimes. Hire-purchase is secured against an asset and may require settlement or a transfer arrangement. Lenders will review the asset and its documentation.

How long does a restaurant refinance take?

From initial enquiry to completion typically 2–8 weeks. Simpler unsecured consolidations can be quicker; complex property-secured deals take longer.

Does combining loans always reduce monthly payments?

Not always. Monthly payments can fall if the term is extended, but total interest paid may rise. Compare the total cost before proceeding.

Will lenders carry out credit searches before providing a quote?

Initial indicative offers can often be provided without a hard credit search. Formal applications usually involve credit checks; your introducer can advise when these occur.

Start Your Free Eligibility Check

Author & trust signals

Content prepared by the UK Business Loans editorial team — Finance Content Lead. Reviewed by experienced commercial finance brokers with a focus on SME hospitality lending. Last updated: 01 November 2025.

We are an introducer — not a lender or authorised to provide regulated financial advice. We introduce businesses to lenders and brokers who can offer finance. Submitting an enquiry does not affect your credit score. See our Privacy Policy for how we handle data.

Ready to simplify your finances? Get a free, no-obligation quote — tell us a few details and we’ll match your restaurant or catering business with lenders and brokers who understand hospitality. It takes about 2 minutes.

Get Quote Now — Free Eligibility Check