Mid March Holiday Let Mortgages were contacted by some customers we had not heard from in many years. The fact that we were hearing from them at all quite surprised us as the buy to let and residential mortgages that we had arranged had been redeemed a long ago when the couple had retired and emigrated to Canada.
The reason for calling us was that they needed some money quite quickly
The Hobsons told us that most of their money was tied up in property assets in both Canada and here in the UK where they owned a £4M property in Fulham which had been let out, but was now up for sale .
The couple wanted to sell the Fulham property to buy another property in Cornwall that could be used as a furnished holiday let property or second home when visiting their Daughter and Grandchildren. The Hobson’s also said that it was highly likely that a return to the UK would take place in later retirement and that living near family would be ideal. The sale would also free up some money to bolster their retirement funds.
Through a friend they had been told about a ”one off property” that was being built at Rock, Cornwall, by the friend’s Property Developer contact and the Hobson’s had been offered a 30 day exclusivity option to purchase off plan at £2.4 M.
They needed a substantial deposit to facilitate exchange of contracts within 30 days and knew that there was no prospect of achieving a non distressed sale of the Fulham property in 30 days.
We said that this was a straightforward case for us because we are familiar with the ex-pat mortgage market and the type of loan required in this case; a bridging loan secured on the Fulham property.
A bridging loan represented the perfect solution to release the £240K deposit required to secure the new build, whilst a buyer was found for the Fulham property and a sale concluded.
The couple were delighted to hear that we knew lenders that would loan money on much more favourable terms than the standard 1-1.25% per month terms that the mass bridging market offered because their case represented a low risk.
After some research we set up a 12 month ex- pat bridging loan secured on the Fulham property, with a 1.75% arrangement fee and a rate of 6% per annum with no exit fee. In this case the lender was quite happy to roll up the interest so that the couple need not find the monthly payments. The exit strategy from the bridging loan would be sale of the property.
The bridging loan duly completed in 25 days and the couple secured their dream property.
Just before Christmas the Hobsons called us to say that their Fulham property sale had completed and the bridge loan had been redeemed at a much lower cost than it would have been on standard bridging terms .
They also informed us that after 5 years in Canada they were on their way home and would move in to “their perfect dream home” in Cornwall that we had helped them to secure.
A satisfactory outcome indeed.