HFBS save default penalty with three day bridging loan
Holme Finance Bridging Solutions (HFBS) turn a bridging loan for £59,545 around in three days to save a property developer incurring a £7,000 default fee from existing lender.
HFBS were approached with the irregular request to re-bridge an existing bridging loan. With funds already borrowed to complete an investment property renovation and a sale agreed all was well until the buyer backed out.
Ian Broadbent, director at Holme Finance Bridging Solutions says:
“Usually we would be incredibly cautious when looking at re-bridging a bridge that has failed, but it was clear to see the developer was simply in an unfortunate situation. His buyer had backed out leaving him three days away from his loan deadline with a fee of £7,000 added should he fail to settle.”
With another buyer lined up the developer was confident of a sale but knew it would be impossible to complete within three days. The client had done all the right things by keeping in touch with his existing lender, however weighing up the overall cost he realised that taking an account with HFBS was considerably better for him than defaulting or extending with his existing lender.
“The completed development was top quality and had been marketed aggressively to line up a back-up sale immediately. As there was another sale agreed we obtained confirmation of the sale price from the solicitor, had the sales agent particulars and comparables all stacked up, which left us happy to fund £59,545 as a second charge of £196,527 with a sale agreed at £463,000.”
The deadline for the client’s existing lender receiving funds was 4pm on Friday the 1st of June. HFBS issued documents to the client on Wednesday 30th of May. Visited the development on Thursday the 31st of May and paid out on Friday the 1st of June in time for the 4pm default deadline, all without the need for a full valuation.