The client is a Chartered Surveyor who works in the construction industry as a project development manager. From London, he also develops in property in his spare time.
He had recently purchased a run-down 3-bed terraced house in a SW London location popular with wealthy families. He intended to extend the house and convert it into a 5-bed residence with a gym, sauna and home cinema. The house had been purchased using an expensive bridging facility which he was paying whilst obtaining planning permission and starting initial works.
He contacted me for help in finding suitable property development finance to pay off the bridging loan and provide additional funds for future projects. After assessing the figures I approached a high street lender who, I felt, would be able to offer significantly better terms than those already obtained by the customer direct. In particular, this bank does not charge exit fees on development loans.
The client provided all information required by the lender in a professional and prompt manner including:
• Details of previous property development experience
• Architects plans of proposed development
• Detailed development appraisal and exit strategy
• Proof of planning permission
• Details of construction contractors
The lender agreed to a loan of £890,000 to be released in tranches. Here are the details of the deal:
Property purchase price: £1,000,000
Build costs: £460,000 + VAT
Gross development value: £2,200,000
Loan facility: £890,000
Loan to value: 63% land, 50% build costs, 40% GDV
Interest rate: Bank Rate + 4.75%
Term: 18 months
Facility fee: 2% of the loan amount (£17,800)
Exit fee: NIL
Completion: March 2015
This is just one example of how I've helped a client secure a buy to let mortgage. To see more of my case studies please visit my profile page. And if you have any funding requirements, please do not hesitate to contact me. My direct line and email address can be found below.