Short term lending for major renovations on unmortgageable London dream home

These clients came to us thinking they needed bridging finance. We found an alternative type of short-term lending that suited them better.

The Scenario

Our clients had been holding out for a house to come on the market on a very specific road they’d targeted, overlooking a park in South London.

Finally property came up for sale at £1.15M, but – it was a bit of a wreck. No kitchen, no hot water: it was unmortgageable.

They needed short-term finance until they could get the essential works done and refinance out onto a mortgage.

They’re both big earners for major financial services companies but one partner is a US national resident here on a spousal visa.

The Solution

We knew the spousal visa wasn’t going to be a problem with finding lending.

More of an issue was going to be how long these renovations are going to take, and how much the borrowing might cost our clients.

We steered them away from a standard bridging loan: the 12-month term could have been a  very tight schedule for them, and we found alternative short-term finance for almost half the cost.

This lending product is like a regulated bridging loan, but the minimum loan size is £300K and the minimum income required is £100K.

Their finance can run for up to two years at 0.25% a month, and has no early-exit fees if they finish their renovations early and are ready to mortgage.

They came to us on a Tuesday, we had credit approval for them by the following day, and an offer subject to valuation but the Thursday.