AREA: Esher, Surrey
AMOUNT RAISED: £650,000
PRODUCT USED: Bridging Loan
Client Scenario
Our clients, a couple going through a divorce, approached us with a complex financial situation. They had received their Decree Absolute but were facing challenges while waiting for their family home to sell.
Key Points:
- Family home valued at £1.6 million
- Husband still residing in the family home
- Wife renting a flat temporarily
- Desire to purchase a buy-to-let property for income generation
- Need for minor renovations on the family home before sale
The clients faced several hurdles:
- Their wealth was largely tied up in their primary residence
- They lacked liquid funds for the buy-to-let purchase and home improvements
- The wife was incurring additional costs through temporary rental accommodation
- They wanted to maximise the sale value of their family home
Funding Solution
Our experienced finance brokers identified a bridging loan as the most suitable option for our clients.
Here’s how they structured the solution:
- Loan Amount: Bridging loan of £650,000
- Security: The loan was secured against their family home
- Loan-to-Value (LTV): Approximately 40.6% (£650,000 / £1,600,000)
- Term: 12-month bridging loan to allow ample time for property sale
- Purpose of Funds:
- £400,000 for a buy-to-let property purchase
- £150,000 for family home renovations
- £100,000 for associated costs and living expenses
Final Outcome
By arranging this bridging loan, we helped our clients achieve several goals:
- Property Investment: They purchased a buy-to-let property, creating a new income stream
- Improved Sale Prospects: The renovations increased the family home’s value
- Financial Flexibility: The wife’s rental costs were offset by the new rental income
- Smoother Transition: The couple could live separately, easing the emotional strain of divorce
Why This Worked
- Speed: Bridging loans can be arranged much faster than traditional mortgages, often within 2-3 weeks
- Flexibility: The loan terms were tailored to the clients’ specific situation
- Exit Strategy: The sale of the family home provided a clear repayment plan
- Asset Utilisation: The clients could put their wealth to work instead of having it tied up in their primary residence
- Reasonable LTV: The low LTV of 40.6% made the loan attractive to lenders, ensuring competitive rates
Our expert brokers specialise in finding innovative financial solutions for complex situations.
This case demonstrates how bridging finance can be a valuable tool in divorce proceedings, allowing for property transactions and wealth redistribution even before the sale of shared assets.
Let’s talk bridging loans!
More case studies
Rapid Bridging Finance for First-Time Developer’s Auction Purchase
