Signature Property Finance provided a £525k bridging loan to facilitate the refinance of a pair of recently purchased freehold properties in Bradford and support completion of works to convert the terraced houses into a 32-bed HMO.

“As a property developer all you want from a bridging lender, apart from good low rates and a fast friendly service, is an understanding of what we’re trying to achieve. The lending team at Signature were prepared to listen and work hard to get the funding in place in time to ensure I could meet my deadlines, without penalty. I found them easy to work with and always proactive, which makes a refreshing change.”

Property Developer in Lancashire

Another in a long line

An experienced property developer had recently purchased a pair of 3-storey terraced houses, each with a basement, that are adjoining but not combined. The intention was to convert the properties into 16-bed HMO with shared facilities, for which planning permission had been granted.

The properties are in the heart of Bradford, in a residential conservation area, close to the University and just 8 miles from Leeds, with excellent transport links close by. This all makes the properties ideal for rent, with similar properties proving popular with students.

At the point Signature were contacted, the developer had funded the purchase and refurbishment of the property to the point of first fix. But to achieve the required HMO certification, further refurbishment works were required, which were predicted to take 6 weeks.

Searching for a lender experienced in every aspect of property development and understanding of the processes from both sides, Signature was contacted to provide the most appropriate bridging loan, within the relatively short timescales.

A Signature solution

The developer, with a decades experience in the construction industry, provided evidence of a number of recent successfully completed projects, covering everything from simple extensions and refurbishments to more detailed conversions and changes of use.

Our funding allowed the developer to redeem her existing loan and keep her sub-contractors on site to complete the necessary works before re-financing the properties onto a buy-to-let mortgage with an accommodating Building Society, which had been agreed in advance.

When considering a project of this nature, we would typically undertake a site visit to allow the developer the opportunity to detail their vision for the property.

But combining our knowledge of the market in the region, with the experience of a developer with tangible net worth and a marketable asset in a good location, made it a simple decision to lend. Once complete the GDV is predicted to be £1.12M, with the potential to deliver £112k per annum in rent.

A 9-month loan was agreed, which offered sufficient time for the developer to complete the works, attain the HMO certificate and re-finance the debt. Again, Signature is filling that critical gap in the funding process that helps property developers expand their portfolios with the minimum of fuss.

“If we had to publish the blueprint of the perfect client, with the ideal deal, this would be a great example. This was a professional developer who knew what she wanted from the deal, but also recognised her responsibility to provide at the start, all the necessary details and proof needed for a deal to progress smoothly and to schedule. I’m confident this will be the only the first in many such bridging loans for this client.”

Tony Gilbertson – CEO Signature Property Finance