Signature Property Finance has completed a bridging loan to help a property developer based in Scotland release equity from a residential property in Prestwick – a deal other lenders had declined due to a previous low purchase price despite the asset’s increased value.
The property, a three-bedroom semi-detached house, had been acquired off-market for just £85,000 in August 2024. At the time, it was tenanted by a non-paying occupier who was unwilling to vacate, which significantly affected the property’s market appeal and valuation.
Understanding the real value
While many lenders refused to consider the property’s true current value, choosing instead to anchor their offers to the original low purchase price, Signature took a more informed and practical approach.
Following the legal removal of the tenant by the property owner, Signature instructed a fresh valuation, which confirmed a market value with vacant possession of £125,000.
A bridging loan of £87,500 gross, secured against this new value, with a loan-to-value of 70%, was agreed. The funds were used to support the client’s next residential acquisition. The loan was structured over a 12-month term, giving sufficient time for the property to be refinanced onto a Buy-to-Let mortgage.
Understanding the story behind the numbers
The Signature team was able to quickly assess the story behind the original purchase price, which involved the previous seller having neither the experience nor the financial means to deal with the problem tenant. This created the opportunity for the developer to step in and unlock the property’s true potential.
Location, structure and flexibility
The property in Prestwick, sits in a modern residential development in a popular coastal town, around 30 miles from Glasgow. Though it currently requires internal updating, including new windows, kitchen redecoration, and general cosmetic improvements, the structure is sound and the location supports long-term demand.
This deal reflects Signature’s ongoing commitment to adopting a practical, common-sense view of each opportunity, even when others default to rigid policy lines.
Bob Stones, Relationship Manager at Signature Property Finance, commented: “What stood out here was the background to the original purchase, which wasn’t a below-market deal in the traditional sense, but a problem that needed solving. The client took on a challenging situation, resolved it quickly and responsibly, and added genuine value to the asset.
“At Signature, we’re not afraid to back a deal where the logic holds up. It’s important to rely on personal experience and understand the deal fully, rather than relying strictly on policy guidelines to dictate the outcome.
“The asset was sound, the exit was clear and the client had a solid track record. It’s exactly the kind of straightforward but smart deal we’re always happy to support.”