Bridging loan for Refurbishment providing 85% Loan to Value.

Deal Structure

£552,500 gross facility amount

£650,000 purchase price

85% Loan To Value

2% Arrangement Fee

Interest at 1.09% pcm, rolled

No Exit Fees

12 months term.

Deal Summary

Our property investor client had agreed to buy a property in Manchester for £650,000 which required a refurbishment. The previous owners had lived in the property since it was built in 1991 and they hadn’t changed much of the original property, but the décor was very “tired” and would need replacing & upgrading to appeal to a new buyer.

The client wanted as high a Loan to Value as possible for the acquisition so he could keep his “Day 1” equity input to a minimum, given he intended to cover the refurbishment costs himself, utilising sub-contractors he had used numerous times on his previous projects.

We presented an option which gave him a NET loan amount of £474,500 (73% net) on a 12 months’ term at 1.09% pcm, with interest rolled up. The lender was comfortable up to 85% Loan to Value gross i.e. including the Arrangement Fee and interest roll-up.

The anticipated schedule of works came to £45k and the client expects the property to sell for up to £850,000 after the works are completed, which recent comparable sales activity supports. The works will take 3 months to complete and the client hopes to sell & therefore redeem the facility within 6 months.

Contact John Waddicker

07977 460546

[email protected]