TAB has completed a £611,250 bridging loan at 75% LTV to fund an experienced property investor’s purchase of an £815,000 property in Iver, Buckinghamshire.
The 12-month first-charge facility, arranged by specialist broker AXK Finance, carries an interest rate of 0.8125% per month.
The three-bedroom detached chalet bungalow (main picture) is currently vacant and requires modernisation, with the borrower considering both development and refurbishment strategies for the property.
TAB structured the facility around multiple potential exits, allowing the investor to proceed with the acquisition while retaining flexibility over the eventual strategy.
PLANNING PROVIDES DEVELOPMENT OPTION
The borrower intends to seek planning permission for a two-storey extension that would add three bedrooms to the property.
A decision in principle for the development provides for a gross development value of £960,000, with a net day-one loan of £539,000 and a further £50,000 available towards the works.
This would leave a funding shortfall of approximately £70,000, which TAB says the borrower has sufficient company funds to cover.
Should planning permission not be secured, the investor instead intends to undertake a refurbishment costing between £30,000 and £50,000.
The property is already considered lettable, with the proposed works primarily cosmetic and including a new kitchen and bathroom, redecoration and replacement flooring.
The borrower has also secured a decision in principle from a buy-to-let lender based on a £615,000 gross loan at 75% LTV, providing an alternative refinance exit without the extension being required.
MULTIPLE EXIT ROUTES
Sophie Meller (main picture, inset), senior BDM for London at TAB, says: “With an experienced property investor acquiring an asset with several potential routes forward, this was a strong case for bridging finance. The borrower had a clear understanding of the property, the plans and the available exit strategies, which gave us confidence in the transaction.
“The condition of the property also meant that the borrower was not dependent on completing the works before securing a refinance exit. There was a straightforward buy-to-let refinance route based on the existing property value, alongside the planning and extension option.”
“TAB understood the borrower’s experience.”
Gena Karaj, founder of specialist broker AXK Finance, says: “TAB understood the borrower’s experience, existing portfolio and the different options available for the property. The ability to proceed on a 75% LTV basis allowed the purchase to complete while leaving the borrower with flexibility over whether to pursue the extension and refurbishment works.
“TAB provided a professional and efficient service throughout the process. Communication was clear, the team were responsive and Sophie, in particular, was very helpful. TAB’s pragmatic approach helped keep the transaction moving, bringing momentum to lending. This was a positive experience and I look forward to working with TAB again.”
TAB’s underwriting on the transaction was carried out by bridging specialist Waheeb Husaini.
