Bridging finance for property?

JacquieH_2

Hi
I have a house worth £450,000 approx. with a current £40,000 interest only mortgage -with £10k still available to draw down. My current mortgage lender, First Direct, is not interested in a short term lending proposition!!!
I want to sell mine and purchase a tumble-down property which we know is coming on the market @ circa £150,000 (to knock down and re-develop!). We obviously may need to make the purchase before my sale goes through to avoid losing it!!
My partner has just moved in with me and our joint incomes are circa £38,000....we are winding down to retirement. He is 60, I am 56 and both currently self-employed. He also has circa £30,000 in savings.
What would be the best way to finance this?
Thank you

Thrugelmir

You won't get a residential mortgage on a redevelopment project. The majority of the value is in the land not the building as it stands.

Try and sell yours asap. Then fund the project in cash. Whilst renting in the interim period.

JacquieH_2

Thanks Thrugelmir....in an ideal world that is what we would like to do!! I guess I'm just trying to cover the possibility that mine won't sell in time!!!

GMS

You should have no problem arranging bridging finance on those figures.

However, arranging the bridging is the easy part. Repaying it is the key.

Bridging secured on both properties should allow you to purchase the property but you then need to get the sale of the current property completed asap which will allow you to repay the bridge and get moving with the development.

Do not jump in to a bridge. Make sure you have your exit pretty much secured, or have a good plan b.

Good luck with it, sounds like a great opportunity

hcb42

sounds like a good opportunity if it works, I can see why the existing bank said no though, that is a lot of mortgage for your income.

Thrugelmir

JacquieH wrote: »

Thanks Thrugelmir....in an ideal world that is what we would like to do!! I guess I'm just trying to cover the possibility that mine won't sell in time!!!

A developer would wish to buy at a price with a sufficient profit margin to make it worthwhile. So it may not sell as quickly as you think.