£10m bridging UCIS fund launched

£10m bridging UCIS fund launched


A short term lender is expanding its loan book by launching a second tranche of fundraising for its bridging loan fund.

Following 18 months of successful operation Paxton Private Finance, which specialises in providing alternative, non-regulated, short term finance solutions, is embarking on a second round of fundraising for its Paxton Secured Income Fund.


The independent principal lender is aiming to increase its funding levels by up to £10 million to meet proven demand in the specialist bridging sector.


The new fund – an unregulated collective investment scheme (UCIS) – provides a facility for short term bridging finance to be secured against property in the UK.


The London-based lender is seeking to expand the fund, which generates returns from the arrangement, interest and exit fees payable by borrowers.


It targets an interest rate of 1.75 per cent for its borrowers, from which it expects to provide a return between 8 per cent and 11 per cent for investors. 


To date it has achieved an average monthly interest rate of 1.84 per cent.


The fund was initially soft launched on 6th April 2011 and it provides investors with access to an attractive investment opportunity in the UK property market via funding for short term asset-backed lending.


There is a limit in the criteria per borrower of 15 per cent of the overall fund value or £750,000 if that is higher. 


There is a maximum loan term of six months, and a maximum LTV of 75 per cent.


This new tranche of fundraising will remain open until fully subscribed or until the fundraising is declared closed at the General Partner’s discretion. 


The life of the fund will run until the 5th April 2016, unless terminated earlier or extended by investors.


David Kinane, Partner at Paxton Private Finance, commented: “While we have seen an increase in lending by high street providers, they will never be able to offer as fast and as flexible funding as the specialist bridging loan sector. Indeed, there is currently significant demand from people who are looking to renovate properties or complete outstanding projects and are looking for the funding to do so.”


Another Partner at Paxton Private Finance, Nick McLean, explained: “While we have provided over £6 million-worth of bridging lending via our suite of products over the last 18 months, we are now looking to raise significantly more capital via our Paxton Secured Income Fund to be used to satisfy increasing borrower demand.”


This new injection of capital will support its existing bridging range which have all been exclusively announced by B&C and include the Refurbishment and Conversion Bridging Loan, All England 2nd Charge Bridging Product and the Paxton Large Bridging Loan Product.



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