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Light Refurbishment Bridging on Property & Costs

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Shawbrook has initially launched this light refurbishment product to a limited panel including Searchlight.  Now, normally you would fund the costs out of your own money, which can limit the number of projects you do. Shawbrook will provide additional borrowing as long as:

Maximum initial loan 75% of lower of the purchase price or value. The total loan including purchase is not higher than 85% of the initial purcahse price or 70% of the end value.

A recent example for an experienced developer.

  • Purchase Price £150,000
  • Costs to refurbish £45,000
  • End Value £260,000

What happened

  1. Day 1 loan of £112,500
  2. 70% of the end value is £182,000 and 85% of purchase price is £127,500 so maximum total loan based on the lower figure is £127,500. Deduct the initial loan of £112,500 and the developer has an extra £15,000 from the lender towards their build costs. This was put towards another purchase which previously they could not afford.

Commenting on this significant development, Emma Cox, Sales Director, Shawbrook Commercial Mortgages;

“We have worked tirelessly over the past five years to improve this important element of our product offering, and 2018 represents a real success story for the Shawbrook STL range. The ability to borrow 100% of refurbishment costs under one facility can be critical for investors looking to add value and develop their portfolios, and we are delighted to be able to support this activity.”

“While the product range continues to evolve in response to market demand, we have managed to keep all the old benefits in place to help our brokers and their customers build for the future. The 0.25% discount remains available for repeat borrowers with no minimum interest periods or ERCs, and we are also pleased to retain a great deal of flexibility for borrowers with the maximum 24-month term providing time to refinance or sell.”

 

 

 

£330,000 refinance from a bank that says No

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Due to their withdrawal from the market their existing lender had given notice to a long established Lancashire property company to move it’s property portfolio to another bank or sell.

The directors were in their 80’s and spent most of their time overseas and didn’t own a main residence in this country. To add to this their tenants received housing benefit which most of the banks didn’t like.

We kept in constant contact with the outgoing lender and updated them at every stage. This gave the bank the confidence to grant extra time in a complicated restructuring.

Never to back away from a challenge we arranged with the directors for a UK based relative to become a director. This gave a new bank comfort in succession planning and where other brokers had failed we obtained the finance needed. The properties have been retained giving the clients a comfortable income in their well-earned retirement.

Refurbishment Loan with lender funding up to 100% of refurbishment costs

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Criteria

Initial Loan 70% of the value
Refurbishment costs 100%
Gross facility up to 70% of end sales value
Loan size £250,000- £1.5m
Term – up to 18 months
Minimum value £300,000
Works lower of 50% of current value or £500,000
Experience essential

Suitable for

Extensions
Conversions
Planning
Permitted development
Heavy refurbishment
Structural works

Another floating charge lender sees sense

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Great news!

Another lender, Paragon has removed the requirement of a floating charge on all portfolio applications for limited companies, incorporated solely for the activity of holding and letting residential properties.

 

Searchlight Finance Limited is registered in England and Wales No.07929050 Searchlight Finance Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (http://www.fca.org.uk/register) under reference 743220. The FCA do not regulate Business Buy to Let Mortgages or most Commercial Mortgages and Bridging Finance. ICO Number Z3109319. Your property may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.

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