The need for a master broker to secure a bridging loan during COVID-19 lockdown

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Loan: Bridging loan


Amount: £429,000


LTV: 65%


Rate: 0.85% per month


Term: 12 months

The specialist finance industry comes into its own when fast and effective short-term lending is required, and during times of economic uncertainty this is more apparent than ever. Bridging loans are  a great way to access large sums of funding in a short time, however with the impact of COVID-19 decreasing the options available in the market, master brokers and their expertise are critical to navigate complex requirements for clients.


Client

The clients are a family comprising of a husband and wife and their two sons, they have owned and run a hotel for over 25 years. Alongside this, they have purchased several Buy-to-Let properties which they have renovated and then let out. The family were looking for a bridging loan to convert part of their existing hotel back to a house containing 3 self-contained flats.

The client was introduced to the team by a broker partner whom Vantage Finance had successfully worked with in the past. Previous cases had been very successful meaning that the broker trusted Vantage Finance and knew that as a team they could support the client.


Situation

The family had run a small hotel formed from 4 terraced houses (no. 2- no.8) for over 25 years. Their plan was to close the hotel and split the properties, with each house being split into 3 self-contained flats. They had already converted No. 2 into 3 self-contained flats which we refinanced onto a BTL Term loan the previous year.

The clients were looking to convert number 8 into 3 self-contained flats and wanted to raise money for the works. Full planning was in place and the title would remain as a single Freehold.

The client approached us at the beginning of lockdown when a lot of lenders had pulled out of the market and valuers had stopped inspecting. With the market at the time so unpredictable another challenge caused by COVID-19 was the significant reduction in products available to the client, the options were very restricted and a large amount of lenders had stopped offering finance on heavy refurbishment projects like this.


Our solution

The physical restrictions in place and the wider impact of COVID-19 hit the property and lending markets quite substantially.  At a time where availability of lending products in the market dropped by 43%, coupled with a halt to physical evaluations, we knew that this case at this time could be difficult.

The first thing that we needed to do was find someone to value the property. With most physical valuations on hold we called through the valuers on the lenders panel to find a valuer that was happy to inspect a vacant property. We had it agreed that the Independent Legal Advice could be done via Video as the clients were not able to get into the solicitor’s office.

Once valued, the second issue we faced was trying to find a lender and valuer that were willing to raise the amount needed during the COVID-19 pandemic and based on a large refurb project at the time. A lot of lenders had stopped lending or reduced the amount they were willing to lend, especially given the money was being raised to fund refurbishments. Having a wealth of knowledge on complex cases and breadth of lending connections meant that we were able to successfully source a lender for the case despite all the hurdles in place at the time.

We worked closely with the lender and solicitors to ensure that we could meet the required completion date and when the original documents hadn’t turned up due to postal delays, we managed to agree for completion to take place on the scanned copies with the originals to follow.


Benefit

The clients have worked with us previously on a complex BTL case, therefore knew that as a team we had the experience and extensive panel to secure even the most difficult of cases. Our clients trust us explicitly and the first-class service and communication they receive is a reason we develop client advocacy.

Having such a wide network of lenders on panel is where our expertise was able to save this case. There were multiple issues in the application that were out of the borrower’s control and down the pandemic and lockdown. Only a master broker and a team like Vantage could have secured this finance under so many complex conditions


Result

Despite all the potential challenges the clients secured the finances they required during the lockdown period and within 4 weeks from application to completion.

Do you have a complex case which needs fast funds? For a quick chat or a meeting to discuss opportunities, drop us a line or give us a call today on 01753 883 195.