UK Property Finance recently helped a newlywed couple purchase and refurbish the property of their dreams. The couple had found their perfect home in a desirable area of Suffolk where they had previously lived and which was being marketed at a price within their budget due to the updating work required.
When the couple approached UK Property Finance, they had already received three estimates for both the timescale and the costs involved in the refurbishments. They also had savings to cover the renovations in full.
To prevent missing out on the property, the clients had to provide proof of funds to the estate agent and, as such, needed an agreement in principle for a loan of £500,000 as quickly as possible. We provided a quotation for a bridging loan within a matter of hours, and to obtain a market-leading rate, this loan was to be secured as a first charge on both the new property and the buy-to-let property they had inherited several years earlier. Their exit strategy was clearly defined as the loan would be repaid in full by the sale of their current home, which, after deductions, would have sufficient equity remaining to clear the bridging loan in full. The bridging loan was arranged with a term of 12 months; however, interest would only be generated while the loan remained unpaid, and as the current residential property sold within 3 months and 3 days of the loan being funded, only 3 months and 3 days of interest were generated, not the full 12 months of the agreed term. This made the recommended bridging loan a highly cost-effective way of funding the client’s short-term requirements.
The loan transaction was completed quickly and without problems, and the couple was able to purchase their dream property and commence the renovations needed prior to moving in. All renovations were completed by the time the sale of the current residential property was completed, enabling the clients to seamlessly move from old to new.