£2.21m business injection for HNW, W1K

Published by MT Finance -

Client circumstances:

Our client was a high-net-worth individual who urgently required £2.21 million to provide cash flow into a number of their businesses. To fund this expansion, they planned to utilise the equity in their main residence which had recently been valued at £13.5m. While the client could have acquired funds from a high street lender, this had the potential to be a lengthy process, which they were keen to avoid. Understanding the client’s need to move quickly, their broker immediately contacted us.

MT Finance solution:

We immediately issued the checklist of requirements, and the valuation was instructed on the same day. Legals commenced four working days later. During the process, the client had business to attend to in mainland Europe. To ensure there were no delays, we approved a third-party professional to fly out and witness the signing of the mortgage deed, thus ensuring the application could progress as planned.

Thanks to this flexibility and everyone’s hard work, we were able to issue a second charge bridging loan of £2.21m after eight working days of receiving the valuation report. As the bridging loan was for business purposes, it was secured against the client’s main residence – which was in a highly desirable area of London – at 52% loan-to-value. Interest was retained at 0.75% over a 12-month term.

The benefits:

Because we took a commercial view and approved the third-party witness, the client was able to inject capital into their multiple business ventures as quickly as possible, which will allow them to expand each of these.

They will exit out of our bridging loan by refinancing the security property with a second charge loan from a private bank. Due to the size of the bridging loan, we obtained a decision in principle from the bank prior to completion. If the client secures this long-term loan before the end of the 12-month term, they will not face any exit fees or early repayment charges.