Our client owned two valuable properties in London, one that they lived in and one that had been derelict for many years. Both had mortgages secured on them together with a large bridging loan that was 2 months past it's due date. Unfortunately they had taken this loan out with an aggressive bridging company who were charging an extortionate rate of default interest due to them going over their loan term.
The existing bridging loan was taken out by our client some 14 months earlier with the plan to renovate and restore the empty derelict property, plus modernise the property that they lived in. This would greatly increase the value of both properties so that they could be sold, allowing our client to downsize and live mortgage free.
Unfortunately the client had no previous experience of property restoration and consequently greatly underestimated the cost of the works. Furthermore by working on both properties simultaneously they ran out of money without completing either property. Their existing bridging lender then refused to lend them anymore funds.
When we were contacted we visited both the properties to fully appreciate the situation. We then arranged a new bridging facility to pay off the existing bridging loan and release some funds to resume work
In addition to having retained interest for 12 months, the facility was also set up to release further funds as the different stages of work were undertaken and completed. This was in order to maximise the loan to value, keep the interest rate and charges as low as possible, and to avoid the previous problems experienced by our client from occurring again.
All work was finished within 8 months and the larger and more valuable property was sold shortly afterwards. This enabled our client to completely repay the bridging loan, leaving the remaining property unencumbered, finished and worth in excess of £1 million.
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What the client had to say
We were in a very difficult situation because we had run out of money and still had a considerable amount of building work to complete on our two properties. Before speaking to KIS we were on the verge of having both properties repossessed and faced losing everything.
KIS were amazing and came up with a plan to prevent the repossessions and provide the funds required to get the properties finished. They also helped us put a works plan together, which we stuck to, finishing the work in good time and on budget.
We could have lost everything, but thanks to the help provided by KIS we now own one fantastic property, mortgage free!