Redeeming an existing bridging loan, TN16
Our client had previously taken out a bridging loan from a different lender to fund the purchase of an investment property which they were ‘flipping’. A portion of the funds had also been used to undertake a full refurb and they had planned to exit out of the bridging loan by selling the asset as its increased value. While this was still their intention, they were keen to secure some more time to help them achieve their desired selling price. However, with the lender’s deadline approaching, they urgently needed to repay their existing bridging loan and avoid any financial penalties. This is when their broker got in touch with us.
MT Finance solution:
While the client needed to move quickly, they also needed to work around pre-existing plans which meant they were going to be abroad for a period of time. With this in mind, we did everything we could to speed up the process. The valuation was instructed the same day that it was handed to our underwriting team and – after receiving the report – we reviewed it and released our finalised offer of lending just hours later. Within 24 hours of the costs undertaking being provided to our acting solicitor, we were able to complete a £945,000 bridging loan at 70% loan-to-value of the property’s open market value of £1.35 million. The term was set for nine months.
Our ability to move quickly meant that we were able to provide the client with a new bridging loan before their deadline, enabling them to repay their existing loan. They now have an extra nine months to sell their property and use the proceeds to exit out of our loan. If the sale completes in less time then they can exit out of our bridging loan without facing any fees or early repayment charges.