Auction Bridging Loan Formby

Formby (on the outskirts of Liverpool) is not the typical place you would expect to find a property up for auction, however it’s not all Premier League footballers and reality stars/influencers who live there and just because it’s an affluent area does not mean that homeowners in that region are not suffering financial hardships just like everybody else.

Below we give an example of a large executive style property that had been repossessed by the mortgage lender and was now being auctioned for sale through one of the online auction portals.

Address of Property Being Auctioned

Shireburn Road, Formby, L37

Property Type

A 7 bedroom and 7 bathroom detached property right in the heart of Formby and near to Formby golf club. The property was being sold at auction with a guide price of £1,750m and comparable evidence suggests that the guide figure was correct. However, because this is a large single unit, the market for buyers at this level is much smaller than say the first time buyer sector.

How Breeze Capital helped the buyer

The property eventually sold at auction for £1,550m and the buyer paid his 10% deposit on the day with the balance to be paid within 28 days or he would be penalised. We provided a bridging loan of £1,070m with a 9 month term. The buyer then rented this property to Liverpool Football club on a rolling 12 month contract at £17,000 per month and repaid us by refinancing our loan with a high street bank.

Since this loan completed, we have done a similar bridging loan transaction with the borrower, also in Formby and again with the same result. The only difference being is that this second loan was a straightforward purchase, not an auction finance purchase. We also show you how a bridging loan can help you invest in property in Liverpool and Merseyside.

FAQs

Can I get a bridging loan for an auction property?

Yes and this is one of the most typical reasons for people taking out a bridging loan. You can buy both a residential and a commercial property at auction using a bridge loan.

What’s the average cost of a bridging loan?

It depends on what you mean by cost. If you mean the interest rate then it will be more expensive than a traditional residential mortgage but that is to be expected when a lender like us takes on more risk than a high street bank would. There will also be additional fees to pay such as a bigger arrangement fee and usually an exit fee of 1%

How easy is it to get a bridging loan?

Pretty simple as the process is designed to be easier than a residential mortgage application. Most bridging lenders do not credit score and most brdging lenders won’t want to see your income details or proof of income.

Which high street banks offer bridging loans?

None I’m afraid. Their sub divisions may well do but the main banks themselves (Barclays, NatWest, etc) do not.

You can call us on 01244 565095