Shawbrook Commercial completes £3m plus refinance of 8 properties in Nottingham
31 October 2016
Large Semi-Commercial loan of £3,062,813 at 69% LTV, loan term of 30 years…
The Commercial Mortgages team at Shawbrook Bank has refinanced a property portfolio for an experienced investor looking to move away from a high street bank, completed via their Broker Partner Empire Corporate Finance Ltd. Shawbrook was also able to lend on full market value after consulting their valuer panel, thereby guaranteeing the maximum amount of finance possible for the client.
Of the 8 properties 6 were HMOs and 2 were semi-commercial premises, all based in Nottingham. From an initial credit search, it was established that the borrower had some outstanding CCJs which the Lending Manager on the case would have to investigate. Rather than allowing this to become a stumbling block, the Lending Manager looked at the case pragmatically to try and reach a good outcome for the customer.
It was discovered that these outstanding CCJs related to unpaid bills belonging to the previous tenants who were international students and had left the country. The broker’s client had fully complied with all legal requests and was waiting to be cleared administratively, allowing Shawbrook to feel confident that the borrower’s sensibly-geared portfolio and character was sufficient to provide a Full Mortgage Offer.
As a further benefit, Shawbrook’s Credit Relationship Manager visited the customer at their home address. This is a resource made available in more complex lending scenarios, to put the broker’s client at ease that Shawbrook is looking closely at their individual needs in order to provide them with a positive lending outcome.
It was established at this time that the customer’s HMO Licence had in fact expired in 2014. After consulting with the broker, the Shawbrook Lending Manager discovered that the customer had immediately re-applied for their HMO Licence but the local council had a two year backlog of applications which they were processing. Good sense dictated that this was satisfactory by proof of application and the case proceeded unaffected.
Rather than a full title investigation being required, title insurance was applied. Along with the fact that the client took advantage of Shawbrook’s “non-rep” solicitor service (whereby they can waive the right to solicitor representation, proceeding under the guidance of the broker), the client made a significant cost saving of several thousand pounds.
The intricate nature of the loan continued right up until the last minute. Just before completion was expected to occur, it was discovered that the redemption statement highlighted a shortfall in funding. After consulting with Shawbrook’s Group Credit Committee, the Lending Manager authorised an increased total loan amount to ensure that the shortfall was covered, a measure greatly appreciated by the client.
Business Development Manager at Shawbrook Commercial for the North Central region, Lee Albino believes that the complex nature of this loan highlights Shawbrook’s case-by-case approach to lending:
“This case highlights several key benefits of the Shawbrook service proposition.
“We were comfortable in lending at full market value which provided the client with the maximum loan value possible, as well as applying good sense with regard to the potential issues around the CCJs and HMO Licence. Whereas this may have set alarm bells ringing at other lenders, that’s not how we work.
“There’s no tick box approach – we look at the individual circumstances of the client and their portfolio – which, when combined with the guidance of an expert broker like Empire Corporate Finance Ltd enables us to achieve a positive outcome for the borrower.”
The broker, Jo Sutton of Empire Corporate Finance Ltd added:
“My client is already investigating the possibility of taking out additional loans in the future with Shawbrook which is, I think, an obvious reflection of how satisfied they are.
“This really wasn’t a straightforward case considering the mixed nature of the portfolio and the ongoing difficulty with renewing the HMO Licence, not to mention the tight deadline my client had to refinance away from their existing bank. Despite this, the lending team and Credit Relationship Manager at Shawbrook were pivotal in securing such a great end result.”
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