Residential Bridging Loan for Development Opportunity in the North West

In this case study, Positive Commercial Finance arranged a Residential Bridging Loan for Development Opportunity, allowing our client to secure a flexible holding facility while they considered the best way to maximise the property’s future value.

The Opportunity

Our client had purchased a large detached executive residence in an exclusive location in the North West.

The property required some upgrading, but the client recognised there was significant potential to increase its value. However, they wanted to carefully assess the best route forward before committing to a specific development strategy.

At the same time, two neighbouring development plots were due to begin construction. These upcoming works could influence the property’s future potential and surrounding market value.

The Challenge

The client needed a flexible finance solution that would allow them time to:

• Evaluate the most suitable development plans.
• Monitor the impact of neighbouring developments.
• Avoid rushing into a refurbishment or redevelopment decision.
• Maintain control of the property while assessing future opportunities.

A standard mortgage was not suitable due to the short-term nature of the requirement and the uncertainty surrounding the property’s future use.

Our Solution

We sourced a residential bridging loan that provided the client with the flexibility required.

The lender was comfortable offering a longer-term bridging facility, allowing the client sufficient time to establish the optimal development strategy.

The facility also allowed interest to be serviced monthly, helping maximise the available loan proceeds.

Deal Structure

• Loan Amount: £563,000
• Loan to Open Market Value: 66%
• Interest Rate: 0.6% per month
• Arrangement Fee: 2%
• Exit Fees: None
• Term: 24 months

The Result

The bridging facility provided the client with a secure holding position while they considered their next steps.

With a competitive interest rate, no exit fees and a 24-month term, the client has the flexibility needed to make an informed decision about the property’s future.

The finance solution allows them to explore the best development opportunity without being pressured into immediate works or a premature sale.