Developer acquires seven flats with Below Market Value Bridging Loan

Looking to purchase a block of seven flats and a large plot of land in Stratford upon Avon, a property developer was able to proceed with minimal equity requirements thanks to the support of Ultimate Finance.

A tailored approach to maximise profitability

Introduced to Ultimate Finance by Chris Oatway and Amy Baptiste at LDN Finance, the developer was assisted by lender and benefited from a 75% LTV Bridging Loan that advanced 91% of the purchase price. Regional Director Laurence Trevaskis explains, “Our borrower had acquired the block at a discounted price, and on a block value basis such an asset may value close to the purchase price. However, since the block had just one title, they were able to create seven individual leaseholds for each flat, which increased the property value on an aggregate basis. This meant that we were able to offer 91% of the purchase price and provide appreciated flexibility to conclude on the purchase”.

An award-winning specialist product

Ultimate Finance’s range of Bridging Loans includes a specialist product known as Below Market Value (BMV) Loans, which look to make the most out of transactions where a discount is available by providing up to 100% of the asking price and maximise profitability. The product is perfectly suited to title splits such as this instance, but also bulk discounts, planning gain, value uplift from works or even cash purchases.

Laurence continues, “We are very proud of our BMV offering, which was recognised as Specialist Product of the Year at this year’s Bridging & Commercial Awards, and I am delighted that it could help support the ambitions of this developer. The transaction was completed in just 30 days, with the exchange happening on day 23 to meet the needs of our client”.

Planned exit route

With the purchase completed, the developer will now refinance the asset onto a Buy To Let mortgage and will look to gain planning permission for a multi-unit development on the large plot of land that is part of the freehold title.