Round-Up: July 2022’s Top Picks

Round-Up: July 2022’s Top Picks

July was a hugely busy month for the Commercial Finance Team, with over 20 completions across a wide range of deals. These deals included:

Commercial Mortgage | 2,600,000

With a deal split across Shawbrook and Cambridge and Counties bank, our Head of Complex Solutions, Ian Pottle, and Commercial Broker, Rob Williams, supported a longstanding client to purchase The Western Isles Hotel on the Isle of Mull.

The discussions began before the COVID pandemic and all the disruption that brought to the industry, with the hotel sector heavily impacted, of course. Despite the rebound in business brought about by the growth of Staycations, our client faced a huge challenge in funding a trading hotel purchase in one of the Scottish Isles. He exchanged on the purchase in 2019, when life was very different, with a view to completing it in the summer of 2020.

In the end, he completed two years later after negotiating an extension, and through Ian’s highly skilled analysis and preparation, we secured a deal for part of the funding via one of our most trusted brokers, Andrew Arnold at Cambridge & Counties Bank. This was on a long-term commercial mortgage with appetite well above anything else in the market despite the quality of our client.

The client wanted an element of interest-only borrowing and a fixed rate, which C&C were unable to offer, so Rob Williams sourced a suitable and competitive deal through Matt Taylor at Shawbrook, releasing equity from the client’s other hotel in Hastings, which is let to Travelodge. Here we saw Shawbrook understand the Travelodge position at the time far better than other funders we approached, and working closely with their credit team, Rob quickly secured the financing required to make the overall deal happen.

The end result is a delighted client who secured a balanced, competitive deal from two proactive funders. Internally, Rob and Ian worked closely together on both aspects and ensured the communication with funders and the client was always outstanding.

Our favourite deal so far in 2022 for the Commercial Team.

Bridging Loan | £357,500

A new client approached us looking to secure their first ever auction purchase, involving a semi-commercial property, consisting of a 5 bed HMO and 2 retail units, through their newly formed SPV. The purchase price for the property was £511,000; a 6-week decline was set to comply with auction deadlines.

As mentioned, this was the applicant’s first ever auction purchase, and he was extremely nervous around this.

We placed this with Shawbrook Bank, who were able to provide a facility at 70% LTV, despite the property valuation coming back at £470,000 (£41,000 below the purchase price), meaning their actual lending was 75% LTV.

Due to the down valuation, the client was short of the deposit. We were able to evidence the passing rent generating from the target property, alongside surplus income from our client’s other properties, allowing this to be a ‘serviced’ bridging loan. As a result, the net loan was increased, and the deal became feasible.

We completed it within 6 weeks of the application being submitted.

Bridging Loan | £240,000

We were approached by Peter Lynn & Partners, who were supporting the borrower in a repossession case. The client had visited her son in Cambodia just before COVID and was stuck out there due to restrictions and concerns over travelling at her age. Due to being out of the country and unable to manage her payments, her buy-to-let mortgage fell into default, with the lender taking up court proceedings to repossess the property.

The client faced difficulties in finding a lender due to her credit status, residency status, and age. However, we sourced a bridging loan against an alternative investment property, which raised enough finance to clear the buy-to-let funder, looking to repossess the property.

This application was completed within the tight time scales (before the last court hearing), enabling our client to retain a family home which had a lot of sentimental value.

Regulated Bridging Loan | £150,000

A client required a “chainbreaker” regulated bridging loan in order to secure a new home purchase ahead of selling their own property, as they didn’t want to miss out on the purchase.

We were able to secure a bridging loan on his current home, releasing the funds to complete the purchase. With the loan being redeemed on the sale of his current home.

Commercial Mortgage | £105,000

A client was looking to purchase their current trading premises, which were previously rented. They were an existing Lloyds customer, so it was an easy introduction for us. There were a few complications around affordability, but through working alongside the customer and their accountant, this was covered off smoothly.

We raised 70% LTV on the £150,000 purchase price, which was perfect for the client’s needs. 15-year term, with monthly repayments below their previous rent payment. This now allows the client to improve cash flow and manage their own property, providing further flexibility moving forwards.