auction finance to save deposit, N14
Client’s circumstances:
Client required a bridging loan to complete the purchase of a residential property he had won at auction. He wanted to make a profit on his purchase and use some of the loan towards refurbishments, before selling it on at a higher value.
The client was unable to go down the mortgage route as he needed to complete the purchase within the 28-day time-frame and given the delays that continue to impact the mortgage lending market, this turnaround was looking unlikely. Time was running out and he risked losing his deposit.
MT Finance solution:
As this was the client’s first investment purchase and he was unfamiliar with the bridging loan process, we worked closely alongside him and in just three weeks, provided a Ā£602,700 bridging loan at 70% LTV of the Ā£861,000 open market value. Interest was serviced at 0.85% over an 18-month term. As with all our loans, there were no exit fees or early repayment charges included.
The benefits:
By taking out our bridging loan, the client was able to complete the auction purchase within the 28-day deadline, saving his deposit. Ā Furthermore, the 18-month term will give him the time to complete the refurbishments and increase the property’s value before putting it back on the market at the increased market value, making a significant profit.
