Shawbrook’s “Lending for Refurbishment Costs” product allows access to 100% of refurbishment costs on short term projects
05 November 2018
Shawbrook Broker Partner “Baya Financial” completes conversion of 1 bed flat to 3 bed maisonette @ 85% LTV
This auction purchase came with a purchase price tag of £494,000 and a 28 day deadline, with the property requiring freeholder consent and a lease extension. The £49,400 cost of works was to allow internal reconfiguration of the rooms, moving the kitchen and bathroom to the ground floor, along with loft insulation and new flooring & decoration.
Unlike many providers, fees for this product are added to the loan which placed the customer at 86.95% LTV on completion. Funds for the works were released immediately and allowed the investor to carry out the necessary works in time to secure a monthly rental income of £1600 and add this property, now with a GDV of £650,000, to a growing portfolio.
In addition to borrowing 75% against the lower of day one purchase price or value, Shawbrook’s Lending for Refurbishment Costs option allows applicants to borrow up to 100% of the refurbishment costs on a single larger facility for light refurbishment projects across residential and semi-commercial security. In this case, all funds were provided on day one with no staged drawdown required. In this instance, a larger gross loan of £429,533 allowed the borrower to both purchase the property and complete the refurbishment project.
Commenting on this innovative product, Gavin Seaholme, Head of Sales, Shawbrook Commercial Mortgages;
“This new Short Term product addition is rapidly becoming a key string to the experienced property investors bow, allowing them to generate value and build their portfolio. We are delighted to expand access to this product feature across the entire Shawbrook Broker panel and look forward to seeing this help investors with their short term property ambitions.”
Eleanor Broadhurst from Baya Financial added;
“We have worked with Shawbrook for many years and have always liked their way of operating; they understand how investors work which is key to us as a broker. We were really excited to see that they had this new product and were keen to offer this new and innovative solution to our clients, allowing them to access more borrowing in order to build and grow. We have been really pleased as it is as easy to use as their other products.”
Commenting in support, Baya Financial’s investor client;
“Baya has excellent communication, knowledgeable staff and they always keep the momentum going. It is vital to my business that I am able to have complete trust in companies that I recommend, as this is paramount to my reputation. The auction purchase process went very smoothly, and I found Shawbrook so easy to deal with through Baya. I would have no hesitation in using the same product for my next purchase.”
The “Lending for Costs” product addition complements the lenders award-winning Short Term offering which retains the same key benefits such as a 0.25% existing customer discount, the ability to switch to a Shawbrook term product with £0 arrangement fee, and no minimum interest periods or Early Repayment Charges (ERCs).
