Signature Property Finance has completed a £123,750 bridging loan to support the auction purchase of a freehold four-bed terraced house in good condition in Newark. The property had been recently refurbished to a good standard with a modern kitchen and living areas.
The borrower secured the property at auction for £165,000 and was focused on a quick, well-priced exit rather than a long refurbishment programme. The 12-month facility funded 75% of the purchase price and was structured to enable a quick sale or refinance once market exposure is achieved.
The value of the property and subsequent sale price expectations were confirmed with a comprehensive DeskVal report. By speeding up the initial assessment of a deal’s viability, DeskVal enables Signature to act with greater agility, providing quicker feedback to brokers and developers without sacrificing the quality or rigour of its lending process.
Clear structure and measured leverage
The independent DeskVal automated valuation model (AVM) supports an OMV of around £196,000, which equated to 63% LTV against OMV and 75% of the purchase price. This stacked up well against a 180-day value and provided the confidence to fund the purchase irrespective of any downside scenarios within the 12-month term.
Lettings evidence supports a market rent of around £1,300 per month (£15,600 per annum), which again offers sufficient headroom for a buy-to-let refinance solution if required, although the primary exit is an open market sale.
Recent sales in the area, support the decision to lend, with these benchmarks reflecting the auction purchase price and supported OMV, representing a sensible value position for a clean, four-bed terrace.
Josh Barrett, Relationship Manager at Signature Property Finance, commented: “This was a straightforward funding decision, made easier by the supporting evidence provided by the DeskVal AVM, which instils confidence.
“This was an experienced client, a well-prepared proposal with clearly defined exits from day one. With sensible leverage and a clean asset, we were able to move quickly and give the borrower the certainty they needed post-auction.”