Bridging Loan Example: £2.85m Bridging Loan to Buy High Acreage Home Before Selling Existing Property

£2.85m Bridging Loan to Buy High Acreage Home Before Selling Existing Property

Area
Buckinghamshire
Capital Raised
£2.85m

Getting a bridging loan to fund a house purchase while waiting for an existing property to sell is one of the most common uses of bridging loans that we see day to day.

Bridging is often the perfect solution to secure a property purchase at a crucial time and can take the stress and costs out of the logistics of selling before buying.

In this bridging loan example, our broker went the extra mile to secure short term property finance for our clients on a complex case where most would have struggled.

The Scenario

Our clients were looking to upsize their family home and had identified a large country home with over 30 acres of land to purchase.

They’d put their current house on the market - a residential property with equestrian facilities - to fund their new purchase.

But, their existing home was proving difficult to sell, which meant they couldn’t make the right offer for the new home they’d fallen in love with.

So, they approached us to source a bridging loan that could secure their new house purchase and bridge the gap of waiting for their current place to sell.

Once their property sale was complete, they planned to use the proceeds to pay off a chunk of their bridging loan and secure a standard mortgage to make up the difference.

However, there were a few complications with their case:

  • Bridging lenders and banks can have issues with equestrian facilities in a property because they can be used for commercial use and limit potential buyers (unless you own horses, you probably won’t want the facilities).

  • Because of the value of their bridging loan, lenders wanted additional evidence that our clients would be able to source finance via a mortgage to exit their bridging loan once their property had sold. As their current property sale wouldn’t completely cover their purchase, they’d need a standard mortgage on top and would need to provide evidence to the bridging lender that they’d be accepted for a loan.

The Solution

We started by selecting a bridging lender that would be comfortable lending against a unique property – such as our clients’ home with equestrian facilities.

We also evidenced our ability to agree with a lender to secure the funds required to refinance after their property had sold.

On top of this, we also secured an agreement for a standard mortgage for our clients if their property sold before the bridging loan was in place and they needed to act quickly. We had all bases covered.

The bridging application was a success, and the quick turnaround of their loan allowed the clients to move quickly on their property and secure a discounted price, as they were in the same position as a cash buyer using the loan.

Refinancing our clients’ home with a longer-term mortgage

When the clients’ existing home did sell, we were ready with a mortgage application to immediately pay off their bridge loan and put long-term finance for their new property.

But this had its complications too...

  • The clients were self-employed and ran their own IT company, so we needed to leverage both their salary income and their company’s net profit to reach the loan size they required.

  • Their company was also growing year on year, and we had to ensure the mortgage lender was comfortable with how they operated.

Our broker took the extra steps to understand how the company operated and generated income to support its sustainability in the future.

We liaised with the lenders’ underwriters to understand their company in-depth, which ensured the provider was comfortable enough to refinance the bridging loan.

The finance we secured was a £1.6m, 2 year fixed rate mortgage at a rate of 1.24% - which we think is hard to beat considering the value and complexity of this case.

 

Max Mallinson

Finance Broker CeMAP

Cardiff

0117 332 5977

Are you in a similar situation? I specialise in bridging finance at Clifton Private Finance - I will find you the best funding solution for your property transaction.

Book a free telephone consultation with me at a time to suit you.

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Jonathan Moffatt

Head of Business Finance

Cardiff

0203 880 8890

Do you need help sourcing your own business finance?

I have extensive experience securing finance for a wide range of businesses. Book a free telephone consultation with me at a time to suit you. 

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Alex Morris

Private Client Adviser

Bristol

0117 332 5061

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I have extensive experience securing UK mortgages for clients. Book a free telephone consultation with me at a time to suit you.

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Scott Dutfield

Finance Broker

Cardiff

0117 959 5094

Are you looking for a similar type of property finance?

As a specialist bridging adviser at Clifton Private Finance, I can take a holistic view of your situation and find the right finance solution for you. Book a free telephone consultation with me at a time to suit you

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Carly Cheeseman

Head of International

Bristol

0117 457 9922

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I have extensive experience securing UK mortgages for clients. Book a free telephone consultation with me at a time to suit you.

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Nick Kerley

Finance Broker

Cardiff

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As a specialist bridging adviser at Clifton Private Finance, I can take a holistic view of your situation and find the right finance solution for you. Book a free telephone consultation with me at a time to suit you.

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Louis Levine

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Sam Baker

Finance Broker

Cardiff

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As a specialist bridging adviser at Clifton Private Finance, I can take a holistic view of your situation and find the right finance solution for you. Book a free telephone consultation with me at a time to suit you.

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Fergus Allen

Senior Finance Broker

Cardiff

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Are you in a similar situation? I specialise in bridging finance at Clifton Private Finance - I will find you the best funding solution for your property transaction.

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Jacob Phipps

Finance Broker

Bristol

(+44) 0117 959 5094

Are you looking for a similar type of property finance?

I specialize in helping international clients source residential and investment property finance for UK property. Book a free telephone consultation with me at a time to suit you.

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Jack Spillane

Finance Broker

Bristol

0117 959 5094

Is your situation similar to this? I specialise in helping clients who need creative development finance solutions, and second-charge mortgages. Give me a call any time and we can set up a detailed discussion of the finance you need. customDatabaseField-8455

Mathew Phillips

Senior Finance Broker

Bristol

0117 959 5094

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Alex Chambers

Senior Private Client Adviser

Bristol

0117 403 4324

Are you in a similar situation? I am a specialist in residential and investment property finance for UK and international clients at Clifton Private Finance. Please don't hesitate to get in touch for a no-cost discussion of the finance you need.

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Luther Yeates

Senior Finance Broker

Bristol

0117 244 5561

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I have extensive experience finding residential and investment property finance for UK and international clients. Book a free telephone consultation with me at a time to suit you.

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Sam ONeill

Senior Finance Broker

Bristol

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I am a bridging finance specialist at Clifton Private Finance. I can find a quick, cost-effective solution for the funding you're looking for. Book a free telephone consultation with me at a time to suit you.

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