Refinance to repay bridging loan

Our client had obtained a bridging loan of £126K 18 months previously to acquire a property at auction. They had carried out some renovation works to the property and wanted to refinance onto a term basis.

The property was a maisonette flat in a row of 4 flats above 4 retail units, one of which was an off licence and the other a micro pub. A number of lenders were put off by licensed units below but we found a lender who was willing to support. When the valuer visited the site he said it was outside of the lender’s policy and placed a nil value on the property. We appealed against this and managed to get the decision over turned. The solicitors then identified a breach in the lease which stated that the flat could only be let to a family and there were 4 individual tenants in place. By chance, the individuals had sent notice to vacate but not immediately. The lender agreed to complete the transaction despite this breach but in the knowledge it was to be rectified. The new lease was exhibited.

Despite the issues along the way, it was refreshing to see a pragmatic approach from our lender partner to enable us to complete the deal for our client.