Gross Loan Amount:
£660,000
Property Value:
£1,100,000
LTV:
60%
Initial Circumstances
A new broker approached us last month when their client suddenly found themselves in urgent need of funding.
The client’s commercial mortgage term was ending, and the property needed to be refinanced. Their initial exit strategy, via the sale of the property, unfortunately fell through. Due to personal circumstances, the buyer pulled out last minute. This left the broker’s client with no time to prepare a long-term financial solution.
Another bridging lender had also pulled out at legal stage, leaving them in desperate need of a fast and flexible bridging loan.
We were more than happy to assist and provide our bespoke service, to ensure they would be able to meet the two-week deadline.
MFS Solutions
As the initial debt for the first charge lender had already been called in, a bridge loan was the fastest way to provide the finance the borrower needed, within the given timeframe. We knew we had to work quickly and unlike other lenders, we underwrite from day one.
The underwriter was able to recover precious time by re-addressing the valuation report from the previous lender, who had already conducted a valuation from one of our trusted member panels. The client found our six-step process to be swift and simple. Our several funding lines also meant we had quick access to the necessary funds.
We completed by the deadline. The first charge lender received their monies, and our short-term loan provided the necessary breathing space for the client to search for a new buyer.
The Benefits
The loan provided ample breathing space for the borrower to find a new buyer whilst also finding a better mortgage offer that works for them. They were also able to keep their mortgage record intact and avoid any penalties that could have been applied if the mortgage deadline had not been met. They had a clear exit strategy and if their commercial mortgage came earlier then their loan term with us then no early redemption fees would be applied.
Further reading:
- Featured Product: Commercial & Semi-Commercial Bridging Loans
- Explainer Video: Commercial Bridging Loans
- Tool: Bridging Loan Calculator
- Report: The post-pandemic outlook of the UK commercial property market
- Blog: What are exit strategies? Everything you need to know about covering your specialised finance costs
- Blog: Commercial property tax guide – what taxes do investors need to pay and what are the allowances?
