High LTV Bridging Loan Covering 96% of the Purchase Price

Positive Commercial Finance specialises in arranging High LTV Bridging Loans for developers with complex property transactions. This case study shows how we helped an experienced developer secure funding covering 96% of the purchase price, allowing them to preserve capital for future projects.

The Opportunity

Our client held an option to purchase a residential property for £890,000.

The site included a large garden with development potential.

During the option period, the developer successfully obtained planning permission for a new-build house within the garden.

They also agreed the sale of the development plot to a private buyer for £550,000, with completion taking place alongside the property purchase.

As a result, only £340,000 remained to complete the acquisition of the existing house.

A Bespoke Funding Requirement

Although the remaining purchase price was relatively low, the lender still needed to consider the value of the retained property.

The existing house was valued at £500,000.

The challenge was to maximise the amount borrowed while keeping the overall loan within an acceptable loan-to-value ratio.

Because the developer had already created significant value through planning permission and had secured a buyer for the development plot, the transaction represented a much lower risk than a standard purchase.

Our Solution

Positive Commercial Finance introduced the developer to a specialist bridging lender that understood the commercial strength of the transaction.

Rather than assessing the purchase in isolation, the lender considered the wider structure of the deal.

They agreed a bespoke facility providing £325,000, equivalent to 96% of the funds required to complete the purchase.

To maintain a conservative overall exposure, part of the interest was serviced during the loan term. This ensured the lender’s maximum exposure remained within 70% loan-to-value against the retained property.

Deal Structure

• Loan to Purchase Price: 96%
• Loan to Value (LTV): 70%
• Interest Rate: 11.5% per annum
• Arrangement Fee: 2%
• Exit Fee: 1%
• Term: 12 months

The Result

The developer completed the purchase while contributing very little additional capital.

More importantly, they were able to keep their own funds available for other investment opportunities instead of tying them up in a single project.

This case study demonstrates how a carefully structured High LTV Bridging Loan can unlock significantly higher borrowing where value has already been created through planning permission and pre-arranged sales.