The Auction
The Case
The client had a potential Buy to Let property that he had exchanged contracts on at
an auction. The Buy to Let mortgage lender declined a mortgage at the last minute
due to the property being uninhabitable. He had a deadline to meet for completion
and had sought 70% loan to value. The purchase price was £190,000.
The Solution
The bridging loan was arranged for £133,000 at a rate of 1.65% per month interest,
with a 1% arrangement fee and no exit fee. This enabled him to secure title. On
completion of minor refurbishment works, which increased the property value by £70,000,
a further new commercial mortgage on investment terms was then arranged at 75% of
a substantially increased property value. This second deal was priced at 3.50% over
bank base rate and subject to a further 1.5% arrangement fee.
Introducer Commission
Initial bridging finance commission of £665, plus a further £1300 relating to the investment deal was paid to the introducer.