The case in brief
- Client: Foreign
- Property type: Development finance
- Property value: £4 million
- Loan Amount: £2.2 million
Securing a competitive mortgage rate secured against a UK property development can be challenging at the best of times, but this is particularly difficult when the developer has no personal guarantee, is based overseas and has very little financial footprint in the UK. This was the case here with our foreign national property developer.
Our client
Our client originated in the Middle East, with experience in property development outside of the UK. They were looking to develop a plot of land in Surrey which held planning permission for 8 houses, with a saleable value ranging from £400,000-£600,000. The total predicted Gross Development Value for the development was estimated at £4 million.
The challenge for us was to source a competitive mortgage lender who would be comfortable in lending to a foreign national who had no personal guarantee. Added complexity came with the fact that they were undertaking their first property development in the UK, with very little UK financial footprint.
The client intended to pay the purchase price of the land, with the construction costs and professional fees being covered by the lender.
Our solution
We were able to negotiate with a private mortgage lender to provide a satisfactory outcome for the client. This culminated in the lender offering 100% of the development and professional fees. In total a £2.2 million mortgage was acquired against a predicted Gross Development Value of £4 million.
The most significant outcome from this was the fact that the mortgage lender was able to offer the mortgage deal without the requirement of personal guarantees. This is an unusual occurrence for a foreign national with very little UK footprint.
International property developers can often find it difficult to secure the finance to penetrate the UK property development market. At Articus Finance, we have the necessary expertise and contacts to acquire mortgage funding, even in the most challenging of circumstances or where the applicant holds very little financial footprint in the UK. You can learn more about our services or speak to a broker today.