Hope Capital delivers refinance solution to achieve HMO investment

Situation

Hope Capital was approached by a client who was looking to obtain a new bridging loan, as their existing loan with another lender was reaching the end of its term.

The particular property, a mid-terrace house based in London, featured two living rooms, two bathrooms, three bedrooms, a dining room and kitchen. Therefore, the space was ideally designed to be transformed into a desirable HMO property.

However, in this situation, the borrower was experiencing delays with their application to secure a long-term buy-to-let mortgage, which was owing to the fact they had some works to complete in order for the application to proceed. As a result, they needed to find a solution where they could pay back their existing bridging loan, while also buying time to complete the mandatory works.

Solution

We provided the necessary funds and agreed a loan term of 12 months. This provided the borrower with the needed breathing space to replace their existing finance with a new loan and buy some additional time to complete the works, which would enable them to secure a buy-to-let mortgage with a mainstream provider.

In addition, at Hope Capital, we are always looking to provide added value to our clients, which is why we helped find a solicitor who we felt confident could act quickly and efficiently on the borrower’s behalf.

Result

Refinancing an existing loan due to delays with a mainstream lender is a scenario we have seen countless times. This is precisely where a bridging loan can provide many benefits, including the opportunity to move onto a cheaper interest rate.

Although the client had agreed to a 12-month loan term, the borrower was able to complete the relevant works quickly, meaning they could exit their loan with Hope Capital two months early.

Having a solution in place, like what Hope Capital offered, ensured the client could complete the works which were holding them back from progressing their buy-to-let mortgage application and as a result, take advantage of this great investment opportunity!