As an experienced short-term property finance specialist, we understand the importance of making the lending process efficient, to ensure the client’s vision is realised quickly and without any major stress.
To achieve this, we work collaboratively with all our clients, evaluating their needs and requirements to propose a deal on suitable terms, always with a view that each deal is an opportunity to create a repeat customer.
It is this flexibility and commitment to supporting developers of all experience levels that has enabled Signature to expand its client portfolio and deliver record annual lending for three successive years.
The Signature approach was recently demonstrated when a well-respected Welsh business, with more than 150 years of heritage, requested a bridging loan of £313,500 to complete the development of a second commercial unit, next door to its premises.
Above the premises, with separate access, were four fully renovated two-bedroom flats which have all been rented out, collecting the landlord £32,880 per annum.
To develop these flats, the client had previously spent £570,000, some of which was sourced via an interest-free council loan, with additional loans provided by high street banks. The remaining £310,000 was funded by the client from their own personal savings.
Besides funding the development of the second unit, the bridging loan would be used to fully repay the lenders that held the first, second and third charges on the property, whilst clearing the overdraft facility on the client’s business account.
In doing so, this would allow the client to follow the proposed exit strategy of remortgaging the property with a high-street bank – a proposal that a number of banks reacted positively to, providing the second unit’s renovation was completed and the overdraft cleared.
To ensure the project could be completed as outlined, Signature first conducted the necessary background and credit checks, before agreeing to the deal on an 18-month term.
With a tenant already lined up to lease the second unit, both parties were confident the development and exit strategy could be achieved within the estimated timeframe, allowing the next stages of the project to progress without unnecessary delays.
Tony Gilbertson, CEO at Signature Property Finance, commented:
“Whilst most clients require bridging finance to complete developments, this particular deal shows how they can also be helpful in clearing outstanding debts to facilitate a proposed exit strategy.
“Upon reviewing the client’s proposal, it was clear that the various elements of the project had been well thought out and there was potential to make a significant profit upon the completion of the second unit.
“As a business, we remain committed to supporting developers as they work to help address the UK’s housing crisis and this project presented another opportunity to provide residents with affordable housing in the form of four, two-bedroom flats.
“It also ensures another local business has access to much-needed commercial space, helping to support the economy in the process.”
The developer added: “From the outset, the entire experience working with the team at Signature has been a breath of fresh air. Communication is good and we have been extremely impressed by the professionalism their team showed throughout.
“They are very experienced and have a deep understanding of the unique pressures and challenges attached to developments of the size. As such, they have worked efficiently throughout the process, ensuring important deadlines are not missed.”