Bakery and Residential flat Above

The UK Property Finance client husband and wife team (66 and 61) have successfully run their cake shop for the last 25 years. They were seeking to refinance and raise capital in order to repay existing borrowings of £58,000. The additional funds were also to be used to make some improvements to the business.

The Loan amount sitting slightly outside of criteria

One of our senior lending managers managed the case due to the loan amount sitting slightly outside of the criteria. In spite of this, we were able to gain comfort in other areas in order to proceed, demonstrating our flexible and personal approach.

The property itself was a semi-commercial retail property, with the cake shop on the ground floor and a residential flat situated on the floor above.

The accounts revealed that trading in the shop was consistent with drawings of £7,350, which was enough to cover personal requirements. The £525 monthly rental income from the flat above, which had been rented for the previous six years, helped to finance this.

The credit profile of the clients and the business was A1 and showed us that their outgoings were by no means exceeding their income.

Whilst age could be seen as a concern, with a low LTV of 43% and a part capital repayment, UK Property Finance was able to view the case pragmatically and was confident to offer the clients the required funds of £63,913.50 over a five-year term with 7.5% capital being repaid.

The UK Property Finance team and the bakery worked swiftly together, and the case was completed within three weeks of solicitor instruction.