£2.1m Commercial Refinance Releases £430k for UK Property Investor
Our client owned a 15 unit block of flats in Exeter made up of 13 two bedroom and 2 one bedroom units. The block was already on a commercial term loan, but when the client wanted to refinance to release equity from the property, the existing lender was not willing to increase the leverage. So, they came to us for a solution.
The Problem
The existing lender had reached the limit of what they would offer. The property was valued at £3,285,000, meaning there was equity available but no way to access it through the existing facility. The client needed a new lender willing to go to a higher loan, at competitive rate.
The Solution
George, our Head of Bridging and Commercial, searched the market for a lender who could meet what the existing one couldn't. This deal was also rate driven, so competitive terms were very important.
We secured a lender willing to lend at 65% of the property's value at 5.18% per annum on a five year term. The deal was structured with no arrangement fee and no personal guarantee needed. On a loan of £2,100,000, having no arrangement fee is a huge saving that many lenders would not have offered.
The Outcome
The client received a £2,100,000 loan. £1,670,000 went to repay the existing lender in full and the remaining capital was freed to put towards new property and back into the business.
The Results
Valuation: £3,285,000
Loan amount: £2,100,000
LTV: 65%
Rate: 5.18% per annum
Term: 5 years
Arrangement fee: 0%
Exit fee: 0%
No personal guarantee
There is normally more available in the market than your current lender is offering. Whether it's a higher loan or a better rate, it is good to know what else is out there.
If you have a commercial property and want to explore your options, get in touch.
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