Our introducer first presented an interesting project that, on paper, fell outside the laid down lending criteria. The client was engaged in a development project of converting farm buildings to high spec residential units. One barn had achieved a successful consent for conversion under permitted development rights and the client wanted to secure planning on the remaining seven units. All seemed straight forward at this point.
However, the client had purchased the property and secured the first planning consent with the assistance and funding of a joint venture partner – another established property development company. Once the first planning was granted the JV partner needed to release their investment and offered to sell the project back to our client.
The loan required equated to circa 81% of the valuation which is more than our maximum LTV for residential properties.
Upon closer review of the structure of the proposal, we were made aware that our client had secured a purchaser for one of the existing properties on the site and that this sale could be completed within 4 weeks from our loan completing.
Hope Capital will always take a commercial view on each and every application and in this instance the board agreed to an advance of £1.9m (83% of valuation) subject to the sale being confirmed and exchanged immediately after the loan completed.
All parties were pleasantly surprised when the valuation report provided much higher than expected figures and was highly supportive of the proposal.
The proposal was ready to proceed when during the legal due diligence procedure additional information was brought to light which had a material impact on the borrower and many other lenders would have pulled the plug on the proposal.
By being able to work with our introducer, the client, and solicitors the issues were resolved and the loan quickly brought to a speedy completion.
By being 100% privately funded we were able to look at all the information and come to a commercially sensible lending decision and in this instance, this gave Hope Capital the ability to complete a complex lending proposal.