Bridging Loan Case Studies

We pride ourselves on exceptional customer care, unbiased advice and our ability to maintain close relationships with an extensive panel of lenders. If you’re looking to secure a bridging loan, this benefits you directly as we’re able to source the best rates and product type for your specific needs.

But don’t just take our word for it, read on for a range of case studies focused on successful bridging finance applications.

To learn more about ABC Finance Ltd and the services we provide, don’t forget to check out our selection of guides and read our detailed breakdown on bridging loans. Read the benefits of working with a bridging loan broker or learn about the bridging loan process.

Case Study 1 – Convenience Store Purchase Using A Bridging Loan

Our client was trading as a convenience store from a mixed-use retail property, and was living above with his wife and young child. As part of an agreement with the current owner, our client would purchase the property at a set time, at an agreed price.

To encourage the vendor to hold on to the property, an agreement was made to make set non-refundable ‘deposit’ payments for the property throughout the tenancy. This had added up to a significant sum by the time the clients approached us.

As the agreed time approached, the vendor became very difficult to deal with and started setting deadlines for completion and even increasing the agreed purchase price. This backed our client into a corner as he had failed to get the full details of their agreement fully documented.

As the deadline approached, it became clear that the client would be unable to secure a commercial mortgage in time. This was disastrous as, if the client failed to purchase the property, they would find themselves homeless and without income. In addition, the vendor made it clear that the non-refundable ‘deposit’ payments would not be returned, under any circumstances. Our first step was to explain what a bridging loan is and how they work, and from there, the client was keen to explore this option further.

Solution

After picking up the application, we were able to secure a regulated bridging loan for the client, allowing them to complete their purchase and rid themselves of their nightmare landlord. This has secured the client’s future and allowed them to move forward with their business and their lives.

The applicants bridging loan application was completed quickly and saved both their home and their business.

Case Study 2 – Development Cash Injection

A client came to us in need of quick funds as they were a majority of the way through building four houses for investment purposes. As the project had overrun they were running out of funds to complete the build.

We assessed the development itself and there wasn’t enough equity in the site to release to refinance the facility, or take our development exit finance, so we looked across the client’s whole portfolio to see what could be done.

Amongst the portfolio were two semi-commercial properties with enough equity to release funding to complete the build. As this was time-sensitive, we looked at bridging finance rather than a commercial remortgage as the longer the release of capital took to complete, the longer the build was on hold for, costing the client money. The client was keen to remortgage as quickly as possible as the interest rates charged on bridging finance tend to be higher than commercial mortgage interest rates.

Solution

The same day we applied for the bridging loan, we also applied for a commercial refinance to repay the bridging loan.

By the time the valuation had been carried out for the bridging loan, we had an offer in principle from the lender providing the exit route giving both ourselves and the client added security that the bridging loan could be repaid.

Although there were few hiccups along the way (from the client’s side), the bridging loan completed, and the build was finished. The client was very happy with our support but admitted that they wished they had contacted us sooner to avoid all of the last-minute stress.

Case Study 3 – Funds Raised for Annexe Using A Bridging Loan

A client came to us in need of quick funds as they were a majority of the way through building four houses for investment purposes. As the project had overrun they were running out of funds to complete the build.

The client wanted to build an annexe on her house to enable her parents to live together under her care, however, they wanted this done quickly and it needed to be funded from the sale of her parent’s property.

She approached us to see if we could raise finance quickly against her parent’s unencumbered house whilst she put the property on the market but, as the property was slightly dated, the selling agent had said that a quick sale may be difficult to achieve. We started from the beginning, what is a bridging loan? How do they work? How quickly do you need the funds? What bridging loan interest rate will I pay? Once we’d covered all of this, the client felt that a bridge loan would be the best fit for their circumstances.

Solution

We were able to arrange bridging finance against the unencumbered property to enable the annex to be built and for the client’s parents to move in and live together again.

As the parents were both still of sound mind, their solicitor visited them both at the separate hospitals to explain the finance and make sure everything was understood.

The bridging loan completed quickly and with no added stress to the clients, their property was sold and the funds were used to repay the bridging loan.

Case Study 4 – Grade 2 Listed Building Funded With A Bridging Loan

This client was referred to us by an introducer and was looking to purchase a Grade II listed property with land and other outbuildings valued at just over £1m. Their attempts to raise a mortgage were proving impossible, which lead them to explore the idea of taking out a residential bridging loan.

On completion the intention was to live in the main property, which meant that they would need a regulated bridging loan. Once arranged, they would split the title and utilities and then refinance the rented cottages which would then release the money to repay the bridging loan in full.

The client has a stable, well-paid professional job and needed finance of just £235,000 as the rest was available from proceeds of a previous sale and a small gift from a family member.

When the application came to us, the client was under a great deal of pressure to complete the purchase and the vendors were threatening to pull out and re-market the property. This meant that their options were limited, as the alternatives to bridging loans would take too long to complete.

Solution

We successfully dealt with a number of difficult challenges including adverse credit and legal issues which provided further hurdles during the application process. We were able to complete the bridge loan application on time to the client’s satisfaction, allowing him to carry out his plan successfully.

Case Study 5 – Medical Bill Loan

We were approached by our client in desperate need of raising £50,000 quickly. His plan was to sell his unencumbered property worth approximately £600,000 and move in with his partner. This would free up the majority of his money to live comfortably in his retirement.

The purpose in raising the money was to pay for his next course of life saving medical treatment abroad. He had arranged a date with the hospital and consultant but the date was getting too close to rely on his property selling.

Although the client was asset rich with his unencumbered property and various vehicles – one of which worth £100,000 which the client also attempting to sell – he needed to have the liquid cash, which is where we came in.

Solution

We were able to arrange a £50,000 bridging loan on his residential property within the limited timescale needed, this alleviated the stress from the client and he was able to have his treatment successfully.

He then sold his property and paid back the regulated bridge loan in full, without issue.

Case Study 6 – Property Purchase Saved

This particular client was referred to us by a bridging loan broker who we have an excellent longstanding working relationship with. We found that the client was at risk of losing a property they were purchasing as they were waiting for their property sale to catch up, as such they needed a bridging loan for their house purchase. There had been a number of false starts for the client after they had been poorly advised on mortgage applications, resulting in a lot of lost time.

They were being pressured for completion of the purchase, so they needed to look at what could be done or potentially miss out on their ideal home.

The client had investments running in the background that they were hesitant to cash in as they would lose out financially, although as a last resort they would go down this route if required.

Solution

Despite the pressures that were being heaped on the client and the extremely tight deadline, we were able to work closely with one of our specialist fast bridging loan lenders to manage both the transaction, and the vendor’s expectations. As a result, the client was able to hold on to the property, complete and avoid cashing in the investments.