2nd charge for dev site purchase, SS17
Our client required £89,100 to purchase a development site through their limited construction and property company. They planned to build residential housing on the site and wanted to leverage the equity in their main residence, which was valued on the open market at £585,000 with an existing first charge mortgage of £206,400.
The client was due to travel overseas and needed to complete the purchase prior to their departure so they didn’t miss out on a fantastic business opportunity. The client had used us previously and as this was an urgent transaction, they contacted us straight away.
MT Finance solution:
We agreed a deadline which gave us two weeks to complete the purchase and flagged the case as high priority. The valuation was instructed the day after the initial enquiry, and we received the report within 72 working hours.
In just eight working days, we provided a £89,100 bridging loan, secured by way of a second charge against the clients’ main residence- four days before our deadline.
As the loan was under £100,000, the interest rate is set at a standard 0.95% per month, made payable over 12 months. As with all our loans, the client will not be charged any exit fees or early redemption charges.
By taking out our bridging loan, the client was able to cover the costs of purchasing the development site and quickly capitalise on an excellent business opportunity. The 12-month term will give them plenty of time undertake the building works to significantly increase the site’s value. Once they complete the works, they will sell the completed housing development at a substantial profit.