16/07/2010

Bridging Loans Rolling Into Buy To Let Mortgage

The Development Finance Team at Enable Finance are proud to announce a brand new product ideal for property investors looking to buy properties requiring refurbishment or are currently un-mortgageable, which of course is where you often find the bargains.

One of the biggest problems buying property via a bridging loan has always been that you need to evidence an exist strategy to close the bridge. Well not any more this product does away with the exit strategy as it has one built in.

6 month Bridging Loan reverting automatically to a standard Buy To Let Mortgage

How this product works: Purchase the property with our fast bridging loan, funding up to 75% of the open market value, not the purchase price. (Loan must not exceed 100% of the purchase price.) The applicant then carries out refurbishment work.

Once applicant confirms that the refurbishment works are complete, the original valuer will revisit the property and will confirm that works have been completed to a satisfactory standard, and that the property is now in a condition to let. A second valuation will be provided by the valuer.

Inspectors will in all cases visit the property at the Bridging assessment stage, and will reserve the right to visit at any time during the refurbishment and/or on completion of such works.

Applicant will be required to provide confirmation that a tenancy (at appropriate level – see below) is agreed and which point Bridging facility will convert to buy to let element. If the applicant is unable to provide a suitable tenancy, or details of a pre-let, 3 months mortgage payments will be deducted from the BTL advance, or if sufficient equity is not available will be required to pay 3 months mortgage payments in advance.

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GENERAL UNDERWRITING CRITERIA
Individuals:	Min age 21 Maximum 65 at inception.
Ltd Companies:	UK Ltd Companies (SPVs only) are acceptable.
First Time Buyers:	By Referral.
Rental Income:	Will be assessed on the lower of Valuers assessment or AST provided.
Minimum Initial Property Value:	£125k
Maximum Loans:	75% to £500k 70% 501k to 1m 65% 1,000,001m -2m £2m+ by negotiation An initial maximum of 5 loans to any one borrower or Company. No more than 3 can be under refurbishment at any one time. Exceptions strictly by negotiation.
Types of property:	Residential only. No properties in pre emption. No RTB. Leasehold – min 70 years remaining at the end of the term. (Shorter in London by negotiation) New build property not acceptable (new build = less than 2 years old.) Ex Local Authority by negotiation. Maximum Floors in block by negotiation. Freehold Blocks of flats under one title by negotiation.
Unacceptable Property Types	· Concrete construction · 100% timber construction · Steel frame construction · Properties with restrictions as regards to occupancy e.g. agricultural, retirement flats etc · Less than 10 years old without NHBC/Zurich Municipal guarantees or architects certificate · Not wholly owned by the borrower (shared ownership) · Deemed as unacceptable security by the appointed valuer · Properties that have been previously underpinned · Properties outside of England & Wales · Properties above pubs/bars · Properties above restaurants, takeaways or any A3 use · Properties above entertainment venues (including Amusement Arcades) · Holiday lets
Geographical:	England & Wales only