Rental portfolio acquired through company purchase.
Recognise Bank has financed the complex purchase of a portfolio of buy-to-let properties with a £1.16 million loan.
The properties on a housing development in Worksop, Nottinghamshire, were owned by a limited company. Rather than buying the properties directly, Recognise supported the borrower in acquiring the company, and thus ownership of the rental portfolio. This saved the client a six figure sum in Stamp Duty Land Tax.
Broker Simon Allen of Searchlight Finance brought the case to the Bank after being frustrated at the struggle to find a suitable lender. Even though the borrower, Kevin McDonnell, is well-known in the UK property industry for structuring similar creative deals, Simon found that many lenders still would not look at the deal because of its complexity.
In the transaction, the existing company directors and shareholders exited the limited entity and the Bank’s clients stepped into their positions. The process involved several sets of solicitors and a higher level of due diligence compared with a standard BTL deal.
Simon Allen of Searchlight Finance added: “Large loans are our bread and butter, and whilst it was a complex deal for some, we knew the transaction could be done due to our experience dealing with property investors. Recognise were a joy to deal with and were positive all the way through the process.”
Source – Recognise Bank Press Release