Commercial Mortgage Refinance for an 18-Flat Investment

his case study shows how we helped an investor refinance a bridging loan on an 18-flat residential investment, despite historic credit issues and an unexpected valuation challenge.

The Challenge

Our client owned a residential investment property comprising 18 self-contained flats in the North West.

They needed to refinance an existing bridging loan onto a long-term commercial mortgage before the short-term facility came to an end.

At first, the case looked challenging.

The client had experienced financial difficulties several years earlier, including a small number of County Court Judgments (CCJs) and failed businesses. Although these issues were historic and fully explained, many lenders would have rejected the application immediately.

Even after we secured an Agreement in Principle for £1.17 million, another obstacle emerged.

The lender’s valuation came back much lower than expected. As a result, the proposed loan was no longer enough to repay the bridging lender in full.

The client needed a lender that would:

• Look beyond historic credit issues.
• Take a practical approach to the valuation.
• Provide enough funding to clear the existing bridging loan.
• Move quickly towards completion.

Our Solution

Positive Commercial Finance started by building a strong case.

We gathered supporting evidence and explained the circumstances behind the client’s previous credit issues. Instead of focusing on isolated events, we demonstrated the strength of the investment and the client’s current financial position.

This approach helped us secure an Agreement in Principle within just a few days.

However, the valuation created a new challenge.

Rather than accepting the outcome, we worked closely with the client, the valuer and the lender to review the figures. This resulted in an improved valuation, but there was still a funding shortfall.

Fortunately, our relationship with the lender made the difference.

We discussed the case directly with the decision-makers and successfully negotiated an exception to their standard lending criteria. As a result, the lender increased the facility enough to repay the bridging loan in full.

Deal Structure

• Loan to Value (LTV): 70%
• Loan Amount: £1.17 million
• Interest Rate: 5.25% over Base Rate*
• Arrangement Fee: 2%
• Term: 30 years

*Interest rates reflected market conditions at the time the facility completed.

The Outcome

The client successfully refinanced the bridging loan onto a long-term commercial mortgage.

More importantly, they avoided a funding shortfall that could have delayed or even prevented completion.

By combining detailed case preparation with strong lender relationships, Positive Commercial Finance delivered a solution that many lenders would not have considered.

This case demonstrates how the right Commercial Mortgage Refinance can overcome historic credit issues, valuation challenges and complex lending scenarios when an experienced broker presents the case effectively.