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Bridging Finance to Purchase and Refurbish Dream Home

Bridging Finance to Purchase and Refurbish Dream Home

The Client: Living in rental accommodation, our client wanted to purchase their dream family home. He also owned one buy to let property in the background to supplement his income.  

The Property: Originally a four-bedroom detached family home,  the current owner had converted it into two self-contained flats. Situated in a town centre in Scotland, the property was close to plenty of local amenities and schools. 

The Finance: In order to refurbish the property back to one unit and make it their home, our client needed bridging finance to cover the purchase and costs of the work.   

The Challenge: Due to the scale of work required on the property, lenders classified it as heavy refurbishment, meaning many were hesitant. The issue we found was either that the lender didn't offer on properties in Scotland, or they weren't happy to offer on cases with heavy refurbishment, meaning we were left with very few choices for our client.   

The Solution:  After extensive research, we managed to find one lender that was happy to lend to our client due to their experience as a landlord. We also provided a clear exit strategy from the bridging finance, moving to a residential mortgage once the works are completed. Despite the rate being slightly higher than the average bridging product, our client was happy to accept based on the opportunity to improve the property's value and make it their home.  

See the property details below:   

Property Details

Property value: £280,000

Loan amount: £196,000

LTV: 70%

Rate: 1.30% per month 

Term: One year, interest-only 

Retained Interest Payment: £30,576

Lender arrangement fee: £6,227 added to the loan 

Consultant: Ross MacTaggart, 01732 471630

NB: ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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in England and Wales No. 2502713.

Registered office:
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Mortgages for Business Ltd is authorised and regulated by the Finance Conduct Authority (No. 313537) to transact regulated mortgages. We are a credit broker, not a lender. We work with the whole of market in sourcing a lender for you; we may receive a commission from the lender, and this amount varies between lenders. The FCA does not regulate some investment mortgage contracts. Mortgages for Business Ltd is a founding member of the National Association of Commercial Finance Brokers, the body that promotes best practice within the commercial finance industry. Telephone calls may be monitored or recorded for training purposes.

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