Interest only loan secured on a pair of office units near the South Coast with tenant break clauses scheduled for 2014. Based on the genuine property experience that the borrower had on his CV, we persuaded the new lender to provide a 5 year interest only facility at 65% LTV on an interest margin of 5.95% over LIBOR with a 1.70% arrangement fee. The introducing Bank and the client were kept fully informed throughout.
Case Study 2 – Residential Investment refinance
The borrrower was a developer having built a block of 9 flats in the West Country completed in 2008 since when the flats have been let on AST. The Bank had termed out the development finance onto an interest only loan of 5 years maturing in March 2013 and were seeking an exit. PCF sourced an interest only loan of £750,000 over 5 years at a margin of 4.95% over LIBOR with a 1.70% arrangement fee which in effect gives the borrower plenty of time to sell the flats individually at full market value as opposed to being under pressure to sell off as a single investment where the discount required by an investor could be significant.
Case Study 3 – Short Term Finance
A well established trading business needed to spend £180k on new plant & machinery to support their expansion plans having recently won a lucrative contract to handle the dry cleaning and laundry services for a flagship London hotel. The specialist nature of the assets meant that the traditional route of asset finance was not possible so PCF sourced a short term bridging loan secured on the directors home priced at 0.85% per month rolled up for 12 months and a set up fee of 2% and no exit fee for early repayment.
Case Study 4 – Peer to Peer Lending
One of the directors of a profitable and well established manufacturing business wanted to retire within the next 2 years and agreed a price for his shares payable on an ad hoc basis as and when cashflow permitted. Despite the excellent track record the company had, none of the High Street Banks were keen on provding a loan facility because the proceeds were literally being paid out of the business. PCF therefore arranged an unsecured company loan of £100,000 repayable over 3 years on a competitive rate of 7.60% with a 2% set up fee and no exit fee. No Debenture or Waiver over Book Debts was required instead an unsupported PG from the main director. The loan was approved within 5 days and funds were in the company’s bank account within 14 days. This new facility did not impact the existing banking relationship in any way.
Case Study 5 – Development Finance
PCF were approached by a sole trader looking to buy a house in North London for £800,000 with planning consent to convert back from a former childrens home into a 6 bedroom detached house. This was the first project of this size that the client had undertaken for themselves as a Developer as opposed to as a contractor for others. PCF secured a base rate linked facility from a High Street Bank which funded the purchases at 60% LTV followed by 100% of the development costs totalling £400,000. The conversion works completed on schedule and the house is now under offer on the market at £2.2m.
Case Study 6 – Invoice Finance
A Docklands based supplier of trained nursing staff to PCT’s and Hospitals was referred to PCF seeking £150,000 to top up working capital having committed a similar amount of cash to buying and converting a freehold building into a fully registered nursing home. Unfortunately, the main director had a single unsatisfied CCJ on her record which effectively excluded prime lenders who might otherwise have assisted. Our recommendation was a highly flexible Invoice Finance facility on a trial basis for 6 months (no contract) secured on the sales ledger and this was approved, surveyed and ready to drawdown within 1 week of meeting the client. Another example of PCF thinking outside the box and for that the customer was very grateful indeed making sure that the staff payroll continued to go through being critical to the long term viability of the business
Case Study 7 – Impaired credit Commercial Investment Loan £600,000
A long established 2nd generation family business was forced into voluntary liquidation following non payment by a main contractor. Secured creditors were fully repaid from the fixed charge over book debts but some unsecured trade creditors only received a partial settlement. HMRC went down for a substantial amount. Control of the account was transferred into a specialist team within the Bank one step short of Recoveries. Not surprisingly, none of the other High Street Banks were able to even consider a refinancing loan for a commercial freehold property that was held within the Parent company. PCF refused to give up and eventually secured full credit approval at £600,000 on a risk adjusted margin 9% on an interest only term of 3 years.
Case Study 8 – Company Buy to Let
PCF were introduced by a High Street Bank to help their client refinance a residual development loan of £120,000 secured on a completed house in the Home Counties let out on an AST. The borrower being a limited company with a property development sic code which made traditional B2L refinance a very difficult objective. On the back of a very comprehensive and well thought through proposal PCF sourced a credit backed loan of £120,00 priced at a margin of 4.75% over LIBOR interest only for 5 years.
Case Study 9 – self build mortgage
A professional couple were having difficulty persuading their Bankers to finance the demolition of their current home and then advance a development loan for the new build which had full planning consent. One meeting with PCF followed by a concise analysis of the possible funding solutions culminated in the borrowers being able to make an informed decision on how to fund the entire project. Working in association with our preferred mortgage advisor, we quickly secured approval for a self build mortgage including several stage drawdowns. The house is now fully built and the self build facility is now being termed out onto a traditional regulated mortgage which is expected to complete shortly.
Case Study 10 – New build Development Finance
All of our packaging skills were put to the test when faced with a request from an electrical contractor to source development finance for the demolition of an existing bungalow in North Watford and the funding of two new build detached houses. The absence of a direct track record as a Property Developer was overcome by asking the client the right questions and presenting the case in a well thought through manner. The Bank eventually sanctioned a land loan to refinance the existing mortgage secured on the bungalow then fully funded 100% of the development costs including interest roll up. The overall facility was stretched to 55% of GDV priced at a 6% over Bank Base with a 2% fee in and 1.25% of GDV exit fee. Both houses were completed ahead of schedule and are presently on the market for sale at £2m.
Case Study 11 – ‘War Chest £500k’ as part of Interest only loan £1m
An experienced Property Developer finished the renovation of a formerly derelict house in Islington N1 situated within a Conservation Area and on practical completion decided to term out the development finance onto a 10 year interest only loan including a ‘war chest’ of £500k to go towards the purchase of another site without planning. The £500k drawdown facility was/is available for 6 months and structured this way the overall package worked very well indeed for the borrower and if course enabled him to acquire the next site which would have been very difficult to finance on its own.
Case Study 12 – Refinance High Street Bank & Capital Raise
Referal from an East London introducer to a double glazing business client seeking to refinance their commercial mortgage secured on the business premises and release cash so that they could go to auction ‘in funds’ to acquire B2L properties. In many ways this was a challenging case given some missed payments, multiple bank accounts, and some structural issues with the property itself. The issues around the property were overcome by instructing a structural engineers report, and the rest simply by working methodically through each point one by one. By working closely together as a team, we finally secured a loan offer of £225,000 on a repayment basis over 20 years on a margin of 5.95% over LIBOR. We paid the introducer 20% of the total commission.
Case Study 13 – Dentist acquiring another practice
A well established dentist with excellent credentials needed 90% finance to buy another practice where the vendor was retiring after 40 years. The consideration was agreed at £750k split between freehold property and goodwill. Both practices were profitable albeit not historically at a level that would fully satisfy traditional bank lending formulas on affordability. We therefore helped the client with production of detailed integrated forecasts with guidance on the key assumptions on debt servicing. At the same time we negotiated a structured solution with the main loan termed over 25 years and then we stretched the goodwill loan from the usual 10 years to 15 years. This kept the monthly repayments at an affordable level for the client which was a key success factor. This case required very careful and thorough packaging taking care to mitigate the Bank’s concerns around affordability based on historical accounts. A 90% facility in todays market is an outstanding result and we were all very pleased with the outcome.
Case Study 14 – Short Term Loan for semi commercial property investment
Experienced property investors came to PCF seeking to get finance for the purchase of a semi commercial freehold property in East London consisting of 2 regulated tenancies, 1 vacant cottage, and some adjoining offices. Not very much income being generated for the usual affordability tests.and there was also a challenge to overcome with the asset type as lending security. Regulated tenancies are never easy to finance. However, we managed to source a very attractively priced solution at £300k equivalent to 50% of the restricted 90 day valuation structured over a 12m term with interest roll up and no exit fees. Since completion , one of the cottages has gone under offer for sale and this alone will almost fully repay the facility ahead of schedule. Once again, it was absolutely key that we presented a full and thorough case to the lender which enabled them to ‘take a view’ on the borrowers based on their experience and net asset positions then in turn table keenly priced bridging finance.
Case Study 15 – Commercial Mortgage £350,000
Cafe business found PCF online seeking to refinance their existing EFG Loan to repay investors and inject working capital. The encumbant bankers took more than 6 months to eventually say ‘No’ yet we were able to deliver a highly competitive refinancing package within 6 weeks. The margin was 2.79% over base and best of all the lenders arrangement fee was ZERO. As ‘icing on the cake’ we proposed and delivered an unsecured 5 year loan facility of £30,000 to repay directors loans putting cash back in the pocket of the owners.
Case Study 16 – Development Facility £1.12m
PCF were asked to source an urgent development facility to release cash from a well advanced property refurbishment project so that the developer could finish the works AND tie up other land purchases elsewhere. The key to this one was to work backwards from the GDV where we structured a ‘two cheque deal’ with the initial drawdown against the current valuation followed by a second drawdown against the projected GDV. The latter was an automatic drawdown as and when the property was furnished without the need for a further valuation.
