Property Investor Hunting Licence2018-09-16T16:24:58+00:00

Property Investor Hunting Licence

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What is a Property Investor Hunting Licence?

With so many changes in the buy to let market, leading to many landlords planning on selling properties to reshape their portfolio there is a definite opportunity for those looking to grow their portfolios with a new type of bridging loan making that process so much easier.

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Historically, clients have approached ABC Finance Ltd looking to buy a property quickly, under auction conditions or similar and have used bridging finance to complete the transaction on time, paying all the fees to do so before refinancing to cheaper debt. This process is then replicated for each purchase and the client gradually moves forward.

A property investor hunting licence is a flexible, pre-agreed facility, which is secured against your existing property portfolio and creates a pre-agreed ‘facility’ for you to lend against. The funds can be drawn down and repaid as you see fit and are earmarked for you to use to ‘bag a property bargain’.

As the lender is not taking security over the new property, it allows you to buy properties that may otherwise be difficult to borrow against.

Criteria

Below are the main criteria points to consider when taking out a property investor hunting licence.

1Up to 70% Loan to Value.
2Properties in a poor state of repair can be considered.
3Loans from £500,000 – £1,000,000.
4Pre-agree a facility for up to 3 years.
5Any security considered.
6Interest can be rolled into the loan.
7Loans with no early repayment charges available.
8We will consider any exit route.
9Adverse credit considered.
10Loans available throughout the UK.

How Much Can I Borrow?

Our funders can secure against your portfolio up to 70% of the open market value on a first charge basis, or 60% on a second charge basis. We currently have funding sources who are looking to pre-agree facilities up to £1,000,000, although we may be able to increase this with strong security.

Is it More Expensive Than a Bridging Loan?

No, as a matter of fact, as you only pay for the money when it is drawn down and don’t have to keep paying arrangement fees, it often works out cheaper than traditional bridging loans.

How Quickly Can I Complete on a Purchase?

As your facility is already agreed and ready to draw down, it is often possible to complete on a purchase in under a week. It is of course crucial that the full legal process and other checks are completed to protect yourself, but this will be purely for your own benefit, not the lenders.

Does The Lender Insist on a Survey Report For Every Property I Buy?

No, as the security for this sort of product is either your existing portfolio, or a single property with sufficient equity, there is generally no need to complete a valuation report on the new property, although buying a property without may be risky on your part.

The savings can continue as you will only ever be charged standing bridging loan rates, regardless of the condition of the property you purchase and the works you plan on completing. With standard property refurbishment loans the cost of borrowing can often increase significantly, something that property hunting licences can protect you against.

Why Go For a Property Investor Hunting Licence?

A property hunting licence allows you to purchase properties under value, extend and refurbish, or even buy currently unmortgageable properties. This gives you an excellent opportunity to add value to your portfolio, meaning you may well be able to borrow what you originally paid for the property.

Many investors are increasingly using this method to build their portfolios quickly, meaning they no longer have to save up a new deposit every time they want to buy a new property.

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