Raising a deal internally to find a solution for a 2nd charge, light refurbishment complication

Loan Amount:
£170,000

Property Value:
£4,650,000

LTV:
26%

While we primarily deal with brokers, we’re more than happy to also work directly with borrowers. A pair of borrowers recently approached us to help with their refinancing plans.

They planned to use our funding for some light refurbishment work on an existing property. The work was primarily cosmetic, meaning there would be no structural changes, or planning permission requirements.

This should have resulted in a relatively smooth and speedy assessment. But, we came up against a key issue during our underwriting stage. Fortunately, the underwriter working on this case held a lot of experience in dealing with unexpected delays, and was able to find a solution.

Internal solutions to external problems

To ensure the client’s investment strategy and long-term plans were sound, our underwriter sought a full schedule for the works. As it was provided, we saw that the refurbishment plans fitted in with the client’s end-goals, and was fully costed. While there was a shortfall, we confirmed with the client’s that it would be covered via separate financial assets.

As we progressed through the deal however, we faced a complication and needed to find additional security. Therefore, we placed a charge on another of the clients assets. Our commitment to lending in the face of these kinds of difficulties allowed us to press ahead.

The underwriter raised this deal internally, and worked with our management team to find a solution. As we found a way to move forward with the client, and given they had a solid exit strategy along with vast property experience, we were happy to issue funding.

We’re able to address a range of complexities

Lenders are unlikely to offer much leeway at the moment. Lending criteria has tightened, costs have risen, and high street banks may only be willing to work with the most vanilla of cases.

Fortunately, we’re able to work with a broad range of complications. Difficult financial circumstances will not prevent us from supporting our borrowers.

What’s more, we’re able to work with foreign nationals, corporate setups or – as was the case with these clients – the self-employed.

If you’re struggling against an overly rigid lending landscape, we may be able to help.