Bridging Case Studies
Case Studies for Uses of Bridging Finance
Client A was due for an imminent eviction. He had been ill, missed mortgage payments and the arrears were now spiraling out of control. Client A had only a small mortgage on the property and lots of equity but could not remortgage due to the recent missed mortgage payments. We were able to obtain a small second charge bridging loan secured on the subject property to clear the arrears avoid repossession. We also guided the client in the methods required to prevent the eviction process allowing time for the bridging loan to complete. We are now in the process of providing new finance to clear the original mortgage and second charge bridging loan thus giving Client A, a much needed new start.
Dream House At Auction
Client B bid for a dream house at auction. This house was also wanted by a number of other interested parties including cash buyers so to secure the deal Client B had to make an immediate offer which was only accepted under the strict condition that completion must take place within 28 days of the auction date. We put a second charge bridge over the client’s current house and a first charge bridge over the new property allowing the purchase to be made within 11 days, way ahead of expectation. Client B has now sold the original property and taken a small mortgage on the new property to repay our auction bridging loan.
Small Cleaning Business
Client C runs a small cleaning business. Due to an unexpected surge in business and to take advantage of a competitors slip our client needed to purchase heavy industrial washing equipment within the month. We quickly arranged a bridge secured on our clients business premises allowing the purchases to be made. The client took absolutely the right decision and repaid our bridge within 4 months from the proceeds of his increased turnover and profits.
Regular Property Developer
Client D was a regular property developer. Property development is no longer considered “sexy” by most high street lenders and even sources our client had used for many years declined further borrowing. As such our client was left without the finance required to complete his part finished building projects. We arranged finance secured on the part built assets allowing our client to complete his project and ultimately preventing the closure of his business. Our client has now sold a number of completed units and has repaid our bridge after 8 months.
Large Tax Bill To Pay
Client E is one of our self-employed clients, who had a large tax bill to pay. He also needed extra finance to make his property marketable. Within a day we were able to arrange an agreement in principle and submitted an application on our clients’ behalf. We were able to quickly arrange the bridging loan to allow the customer to pay his tax bill on time. He was also able to start the impending work on his property and will shortly be able to market that property so that he can repay the loan.
Downsizing To A Smaller Property
Client F was downsizing and looking to purchase a new smaller property. She didn’t want to miss out on the new property. Her existing property had some previous holiday lets. These Holiday lets had not been let out in over 4 years. As this property had a commercial element to it the client was struggling to find a lender. We were able to find her a willing lender who secured over both the new and existing properties. She didn’t lose out on her preferred new property and will repay the loan once her existing property sells.
Repay Existing Mortgages
Client G owned 2 properties in London both with outstanding mortgages on them. Clients mortgage was on an interest only basis and the term was coming to an end. We were able to swiftly arrange a bridging loan to repay the existing mortgage. The client was also able to borrow extra funds to consolidate existing debt. He will be repaying the loan as soon as one of his properties sell.
Purchase Industrial Building Over Market Value
Client H wanted to purchase a dilapidated industrial building for over the market value. He had been rejected by a few lenders already. The client intended to purchase this building and convert it under permitted development into two units. He wanted to borrow enough funds to buy the property and do the required works. He was also using a property in separate company name as collateral. We managed arrange some terms within 24 hours and swiftly made an application on behalf of the client. He will repay the incomplete property loan by sale of the refurbished units.
House Conversion To Flats
Client I owned an unencumbered house in South London that he was converting into 4 flats. He needed finance to do the full works. He had planning permission in place. As the property was wind and water tight we were able to swiftly arrange a bridging loan for heavy refurbishment work. Client planned to complete the work and sell 3 of the completed flats and repay the loan.
New investment Purchase
The clients were looking to borrow some funds to allow them to complete the purchase and refurbishment of a new investment property. The clients had recently decided they would like their investment properties to be in ltd company name so UK Property Finance were able to guide them through the differences in the process for a ltd company vs a personal name purchase.
The works to be done were not structural or requiring planning so we were able to obtain them a market leading standard bridging loan rate. The purchase was able to be used as sole security for the loan as client intended to sell this at a profit to exit the loan.
The bridging loan was able to complete within 4 weeks allowing them to keep their vendors happy and get the works started to profit from their new investment property!
We can provide many more bridging examples and more information on the different bridging loan types of bridging loans available.