urgent auction purchase for landlords, OX4
Client circumstances:
Our clients, who had previously sought our assistance for two bridging loans, found themselves in urgent need of £217,000 to secure a residential property they had secured at auction. With contracts exchanged and a completion date set, they only had a month to gather the amount and achieve their aspiration of renovating and renting out the property. Knowing that they could count on us, they instructed their broker to reach out to our bridging team.
MT Finance solution:
We instructed a valuation on the same day we received the case and received the costs undertaking the following day, which allowed us to proceed with the legal process. With all these tasks completed, we finalised a first charge bridging loan of £217,000 just two days after receiving the valuation report, beating the clients’ deadline by three days. The loan-to-value (LTV) was set at 70% of the property’s open market value (OMV) of £310,000, and we set the term for 12 months.
The benefits:
With the property now in their possession, our clients can focus on undertaking a full refurbishment. They have wisely budgeted £20,000 for the renovation, which, upon completion, is expected to significantly increase the OMV of the property to an impressive £400,000 – ensuring a profitable investment for the future. This allows the clients to refinance their bridging loan with a buy-to-let mortgage, taking full advantage of the property’s increased value. And if they refinance before the 12-month term ends, they won’t have to worry about any early repayment charges or exit fees.
Find out more:
If you are planning to purchase a property at auction then we’d love to hear from you. We can further speed up the process with an automated valuation (AVM) for cases that qualify. AVMs can be used on standard residential bridging property applications up to a maximum LTV of 60%, a maximum value of 60% and a maximum loan size of £450,000. Drop us a line to find out more.
