CASE STUDIES

Many of our customers are experienced investors who have many war stories to share, we also work with new investors who maybe entering the property market for the first time and need guidance and help on their deals. We love to share ideas on the types of deals that are profitable for our clients in the hope that you can learn from those making great profits and are building their portfolios.

Here are a few examples of recent projects we have helped fund:

Project #1 – Block of 8 Repo Flats in North West: No Money Left In/Cash back

Our client was able to secure the block of 8 flats for £130,000, that’s £16,250 per unit and refurbish them for approx £67,000 including all finance costs. Title was split and a commercial mortgage arranged to clear the bridging finance. The gross development value of the site was £320,00 (£40,000 per unit). With a 70% LTV our client was able to draw down approx £224,000, which was more than enough to cover the initial purchase, bridging fees, Refurb costs, legal fees and have a cash surplus of approx £27,000 to inject into his next project. We provided a gross bridging loan of £150,000 – 115% LTV based on the security and strength of exit.

  • Purchase Price:
  • £130,000
  • Cost of Works:
  • £50,889
  • Cost of Finance:
  • £16,111
  • Total Costs*:
  • £197,000

 

  • Gross Development Value:
  • £320,000
  • Draw Down from Lender:
  • £224,000
  • Cash Back:
  • £27,000

 

  • Gross Bridging Loan:
  • £150,000
  • LTV:
  • 115%
  • Loan term:
  • 2-3 months

 

*Excludes Legals, SDLT if applicable and other costs not shared by client.

Project #2 – Split Block of 3 Flats & Create New Leases & Sell for £200k Gross Profit

Our client was able to secure the block of 3 flats in the South Coast for £430,000, that’s £143,333 per unit and refurbish for approx £53,000 including all finance costs. The Refurb was a new kitchen and bathroom in one flat and a lick of paint outside. Title was split and an estate agent instructed to market the three flats ASAP. Three sales have been agreed at an average price per unit of £210,000 including a share of the freehold. The gross development value of the site was £630,00 (£210,000 per unit). Our client will make a gross profit of £200,000 leaving him with sufficient funds to move onto the project. We provided a gross bridging loan of £320,000 – 75% Loan to Purchase Price.

  • Purchase Price:
  • £430,000
  • Cost of Works:
  • £15,000
  • Cost of Finance:
  • £38,000
  • Total Costs*:
  • £483,000

 

  • Gross Development Value:
  • £630,000
  • Gross Profit:
  • £200,000
  • Net Profit:
  • 147,000

 

  • Gross Bridging Loan:
  • £320,000
  • LTV:
  • 75%
  • Loan term:
  • 4-5 months

 

*Excludes Legals, SDLT if applicable and other costs not shared by client.

Project #3 – Convert HMO Property in North East: Low Money Left In

Our client was able to secure a property in the North East for £90,000, the goal was to convert into an HMO at a cost of £10,000 with an exit route based on Commercial Finance. After a minor Refurb, the Commercial Lender valued the HMO based on income at £155,000, 72% higher than the original purchase price. This is the power of using commercial finance to value property based on its income.

Bridging finance of £71,250 was supplied by ClosedBridgingFinance to secure the purchase at £90,000 – 79% LTV based on the exit route and security provided by client. After 4 weeks, title had been registered with land registry, commercial funds drawn down and to take out the bridge. The cost of the bridging finance was £5,250. the client received £100,750 as the drawdown from the lender, leaving him with £4,500 of his funds left in the property. Using traditional finance he would have left approx £32,500 of his cash pot in the deal, using bridging finance and access to our network of professionals he has saved over £28,000 – funds he can use to buy more investment property.

  • Purchase Price:
  • £90,000
  • Cost of Works:
  • £10,000
  • Cost of Finance:
  • £5,250
  • Total Costs*:
  • £105,250

 

  • Gross Development Value:
  • £155,000
  • Draw Down from Lender:
  • £100,750
  • Cash Back:
  • £4,500

 

  • Gross Bridging Loan:
  • £71,250
  • LTV:
  • 79%
  • Loan term:
  • 1-2 months

 

*Excludes Legals, SDLT if applicable and other costs not shared by client.

Call 08456 440 911 for a tailored illustration for your project today.