Overcoming Adverse Credit Issues for a Complicated Refinance Deal

credit history issues for a BTL investment

Loan Amount:
£1,100,000

Property Value:
£1,820,000

LTV:
60%

Refinancing for a multi-use property is difficult, but this can be made especially hard where adverse credit issues are involved. A borrower required funding to cover existing facilities and progress their investment plans.

Although, as our underwriter got to work, we discovered a number of issues in the borrower’s financial history. This not only threatened to slow down our deal, but also put their long-term refinancing exit strategy at risk.

Also, the underlying property required extensive works which may have limited demand in the market once all the borrowers’ affairs were organised. To ensure we could overcome these potential issues, we bore into the details.

Taking a precautious approach

To start with, we assessed the adverse credit issue. While the issue would eventually threaten their progress on this, or any venture, we saw that the borrower had set resources aside to address it. With it effectively covered, their record was otherwise clean.

We then turned our attention to the underlying property. Despite the high level of admin that would be needed following our support, we could see that the asset held potential. It was in a desirable location and was already tenanted. This highlighted the borrower would not struggle with generating income as they optimised their set up.

With these potential challenges addressed, we noted the borrower would have no issue refinancing with a long-term lender for the exit strategy. We confirmed that they would be able to raise further funding based on the investment’s current value and potential in the market and as such, we delivered funding.

Being there for troubled property investors

Dealing with adverse credit issues is likely to be a defining feature of 2025. As we approached the final months of 2024, the number of adults with adverse credit hit a record high. Some 8.4 million people experienced it in the prior three years.

Fortunately, we’re ready to help people here. Across our products – including all our bridging loans, BTL mortgages, and Bridge Fusion options – we’re able to support those with CCJs, bankruptcies, IVAs, and more to their name.

Should further complications arise in the property market, we’ll be there to adapt to them.

FAQs

What type of multi-use properties do you accept?

We are able to consider a wide range of multi-use properties for funding, including those with both residential and commercial elements. Whether it’s a retail unit with flats above, a mixed-use facility, or more complex configurations, we take a flexible view on property types. Our underwriting process is designed to assess each case on its own merits, so we can support investors and borrowers who require bespoke solutions for non-standard properties.

Can I refinance with credit history issues?

Yes, we can assist borrowers looking to refinance even if they have faced credit challenges in the past. We understand that adverse credit can occur for a variety of reasons and does not necessarily reflect your current ability to service a loan. Our underwriting team takes a pragmatic approach, focusing on the asset and the exit strategy rather than relying solely on credit scores. This enables us to support clients with complex circumstances who need to refinance quickly.

Do you accept overseas investors and companies as applicants?

We regularly work with overseas investors and corporate entities looking to secure funding in the UK property market. Whether you are a non-resident individual, an offshore company, or an international trust, we can structure lending solutions to suit your requirements. Our experience in handling cross-border transactions ensures we can navigate more complex ownership structures and timelines.

Is it possible to consolidate multiple property loans into a single facility?

We can provide facilities that allow clients to consolidate several property debts into one streamlined loan. This can be particularly useful for investors managing multiple assets with different lenders or repayment schedules. By structuring a single facility secured across the portfolio, we help simplify cash flow management and often reduce the overall cost of borrowing. Our team will tailor the solution to fit the borrower’s wider investment strategy.