United Trust Bank (UTB) has facilitated a £345,000 second-charge regulated bridging loan, enabling the purchase and renovation of a holiday let property. This financial arrangement allowed the owners to acquire a £312,000 property in a prime coastal town in the southwest UK, with additional funds earmarked for refurbishments to transform it into a profitable holiday rental.
The owners, who have an existing mortgage of approximately £210,000 on their main home valued at £1.6 million, opted for this loan structure due to the ample equity available. This decision ensured a swift transaction, which was crucial for meeting the acquisition deadline.
There were two exit strategies considered for the bridge loan. The primary plan involves refinancing the holiday property, which is anticipated to be worth around £410,000 following improvements. As a backup strategy, the owners plan to refinance the first charge mortgage on their main residence, supported by their combined income.
This transaction illustrates how homeowners can leverage their existing property equity to seize real estate investment opportunities.
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