Initial circumstances: The client owned a successful textile manufacturing company and as part of his growth strategy, was looking for funds to help him acquire a similar company. As part of the acquisition, the client was able to take over an existing contract for materials and products from Southeast Asia, including a shipment that had already been approved and prepared for the new company. However, the sellers had a specific completion date which meant the client needed to move quickly to take advantage of the opportunity. He had attempted to borrow against his main residence, valued at £950,000, which had an existing first charge mortgage of £295,000. However, his existing mortgage lender was unable to provide additional funding against the property in the time-frame required. Due to time sensitivity, the client’s broker contacted us straight away.
mtf solution: On receipt of the enquiry, we were able to give an immediate decision and issued the offer in principle that day and as we were faced with roughly 2 weeks to deliver the funds, we immediately instructed the valuation at the same time as going to offer. In just 13 days, mtf was able to secure a second charge £275,000 loan on the client’s property, at 60% LTV, based on the current open market value. Interest was retained at 0.85% over 12 months, with no exit fees or early repayment charges. No personal guarantees were required.
The benefits: Our loan meant the client was able to complete the acquisition by the specified completion date and capitalise on a fantastic investment to his business. Within 9 months the client was able to show a trading pattern and increased income that allowed them to raise monies to exit our loan.