My client was currently dealing with a rather unusual situation, in which there were several financial obligations he needed to meet. A self-employed business owner, my client had encountered a series of cash flow problems and approached me for a solution.
My client rented a commercial property, which was the premises for his business. Unfortunately, he was now in arrears for his rental payments, and risked being evicted and losing his business as a result.
My client also owned a buy to let property. He already had a first and second charge against this property, and his current lender was not prepared to extend this facility in light of his credit rating. Ultimately, he decided he needed to sell this property in order to repay his debts.
This property was a HMO, in which each room was let individually. However, this was not managed by my client; he had a commercial lease with an associate who lived in the property, and then sublet the rooms. This contract was due to run for six more months, so my client was unable to sell this property immediately.
He therefore needed finance to bridge the gap between now and the sale of his buy to let property. Short term funding solutions such as bridging loans can often be helpful in these scenarios. My client’s background issues made it difficult for him to find a lender; fortunately, I have a close working relationship with a lender who has a flexible and open attitude to unusual cases, providing they can see a solid exit strategy.
As it was clear my client would be able to sell his property as an exit strategy, I was able to arrange a second charge bridging loan facility for £270,000 at a rate of 0.95%. This enabled my client to repay his outstanding debts, covering him for the period he needed.