AREA: Lake District, Cumbria
AMOUNT RAISED: £680,000
PRODUCT USED: Bridging Loan
Client Scenario
Our client, a successful entrepreneur from London, approached us with an exciting opportunity. They had found a charming 3-bedroom stone cottage near Windermere, valued at £800,000.
The property had excellent potential as a holiday let, given its prime location and the strong UK market.
The client was eager to secure the property quickly, as it had just come onto the market and was attracting significant interest from other investors. However, they needed to raise capital swiftly to complete the purchase.
The client’s assets included:
- Their main London residence, valued at £1,200,000 with a £400,000 mortgage outstanding
- A buy-to-let flat in Manchester, valued at £300,000, unencumbered
Their strategy was to use a joint bridging loan to purchase the Lake District property outright, then refinance onto a holiday let mortgage once they had established a track record of rental income.
Funding Solution
Given the time-sensitive nature of the purchase and the specific requirements of holiday let properties, we knew we needed to approach specialist lenders who could offer competitive rates and understand the nuances of this market.
As expert finance brokers, we leveraged our extensive network of lenders to find the best solution for our client. After careful consideration of various options, we successfully sourced a bridging loan with the following terms:
- £680,000 capital raised
- 0.59% per month fixed rate
- Interest rolled up
- 12-month term
- First charge on the Lake District property
- Second charge on the London property
To streamline the process and reduce risk for the lender, we advised the client to work with a solicitor experienced in both bridging finance and holiday let purchases. This expertise was invaluable in ensuring a smooth transaction.
We also guided the client through the process of obtaining second charge consent from the first charge lender on their London home.
Despite the complexities involved, our expertise as finance brokers allowed us to complete the entire process in just over 4 weeks, enabling our client to secure their dream holiday let property ahead of the peak summer season.
Final Outcome
With the bridging loan we brokered in place, our client successfully purchased the Lake District cottage. They immediately began marketing it as a holiday let, taking advantage of the buoyant short term letting market.
Within six months, the property had established a strong booking record and consistent rental income. This performance allowed the client to refinance onto a competitive holiday let mortgage, which we also helped arrange, paying off the bridging loan ahead of schedule.
Through our brokerage services, the client was able to:
- Secure a desirable property in a competitive market
- Start generating income from holiday lets immediately
- Establish a profitable addition to their property portfolio
- Successfully transition to a long-term financing solution
This case highlights the value of working with experienced finance brokers who understand the intricacies of both bridging finance and the holiday let market.
Our ability to source and arrange flexible financing solutions allowed our client to seize a time-sensitive property investment opportunity.