Bridging deals of the week

With lenders in the short term sector beginning to diversify their product range to help a broader range of clients obtain the finance they need, here at B&C we have brought you the very best in recent deals that have utilised these new and innovative niche products.

This week, we’re focussing on MT Finance, which has provided some recently completed funding projects…
Speaking on the two cases, Tomer Aboody, Director of MTF, said: “These cases demonstrate the pragmatic hands on approach to lending that underpins everything we do at MTF. We are here to make cases work, and not just the easy ones.”

Case One:

Leasehold Flat – Redcliffe Road, London, SW10

The applicants on this case had exchanged contracts to purchase this leasehold flat in a desirable part of London, off plan from the developer in early 2011 for £500,000.

The applicants had applied to The Woolwich for a mortgage on the property, based on its open market value of £600,000.
The Woolwich had approved the application, but would only lend 65 per cent of the purchase price - which left the applicants with a shortfall to complete.

The applicants contacted MTF via their broker and the company was able to issue terms on the same day, with an offer of finance of £420,000 based on a projected open market value of £600,000.

After agreeing to the terms, the applicants then paid for a valuation report to be commissioned by an independent RICS firm - the report was received within three working days.

MTF was able to offer a loan of 70 per cent LTV based on the open market value of £600,000, and a seven month term at 1.25 per cent per month with no exit fee or early redemption penalty.

The applicants requested funds and the case was completed within five days of the original enquiry.
A bridging loan from MTF allowed the applicants to complete the purchase, and gives them the time to refinance without penalty based on the fair open market value of the property.

Case Two:

Mixed Commercial Residential Property – Ilford

MTF also recently completed a loan of £850,000.00, secured by way of a first charge over a mixed residential commercial asset in Ilford valued at £1.5 million.

The existing mortgage had gone into default and the existing lender had placed an LPA receiver on the asset whose fees were rapidly accumulating in additional to the various interest and other charges being levied.

Given the fact that an LPA receiver had been appointed, and the ‘distressed’ nature of the circumstances, the borrowers found themselves looking over a cliff and it was most unlikely that a high street lender would step in.

MTF was able to provide a bridging finance loan of £850,000 over four months to redeem the existing mortgages, and to pay the LPA Receivers fees - putting the owners back in control of the income producing asset.