Bridging finance: client purchasing their existing business premises

Securing a bridging loan for clients who wished to purchase their existing business premises

Article by David Gissing Specialist Finance Adviser

What was the situation?

I was approached by clients whose landlord was selling their commercial premises. After a much-needed refurbishment, and a significant injection of cash into the premises, the clients did not want to lose their recently refurbished home or their business.

The property was a listed commercial property in a rural location, offering a home for my clients healthcare clinic. Located in Sussex, the client wanted to borrow £245,000 for the purchase.

What was the issue?

The business was newly incorporated, and their accounts did not support a commercial term loan. As a result, I knew the best solution would be to seek a mid-term bridging loan for two years which would allow ample time to get the next year or two’s business accounts in place, and at a satisfactory level for a commercial term loan.

What was the process?

Knowing this was not an entirely straightforward case, I reached out to suitable lenders who I knew could consider the case and apply some flexibility and discretion.

Once agreed with the lender, the process had taken slightly longer than expected and as a result, we needed to apply for a small extension to retain the terms that had been agreed, which could have increased due to rate increases. Thankfully, our strong relationship with the lender meant they were happy to assist and honour the original deal.

What was the solution?

We were delighted to achieve the full gross loan for the client on a part serviced part retained basis. The clients felt safe knowing that they owned their property, to do with what they want, and have security over the future of their business premises.

 

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