I was recently able to assist a married couple in their fifties with a first-time development project. My clients approached Enness after three other brokers were unable—or simply not interested—in assisting them with their unusual situation.
My clients had no development experience, and securing finance for conversion projects can be difficult if the borrower has no experience. However, after inheriting an unencumbered property in central London, they were presented with an opportunity for financial independence.
The property in question was a five-bedroomed semi-detached house, valued at £1.5million. My clients had decided to develop the property into three self-contained flats; one would be sold to cover the build costs, the second would be let out to generate an income stream, and the final flat would be their unencumbered main residence.
However, they had no experience with either refurbishment or development and were understandably feeling cautious about how to proceed. I was very happy to work with these clients to help them realise their ambitions. Fortunately, my track record of experience in arranging finance for first-time developers reassured them.
I therefore approached a lender I have a good relationship with, who I knew would be willing take a view on the clients’ overall circumstances. Despite their lack of refurbishment and development experience, my clients owned an unencumbered property worth £1.5million—and having researched carefully, they had excellent contractors in place and had secured the relevant planning permission. Many more experienced developers have nothing near such a valuable asset to use as security.
As such, my clients did not represent a risk, and the lender was happy to offer terms for the case. I negotiated for a rate of 0.95% per month on a 12-month term. This was essentially development finance with drawdown stages to enable them to progress with the works.