Renovation Finance for church?

chapelconversion

Hello all,

We have bought a beautiful church and hall, have planning and building regs through. It's taken 6 months of nightmares to get it mortgaged. Our initial plan was stage payment, but the lender took so long, in the end we have just completed through Halifax, just to buy the property, as we were concerned it was about to be sold to a developer, esp as we have planning approved.

So, with that in mind, we don't have the full amount to complete the renovation, maybe £80k shortfall.

We have fab credit scores. We own business property, but remortgaged to release the equity for deposit, fee's and build costs. Joint income £83kpa

My FA has said we couldn't get bridging loan as there needs to be more equity than the 30k we put as the deposit.

My question, is whats the best way to fund/borrow £80k (ha! not asking for much hey?).

Oh and my builder suggested funding circle, but they are only Biz based right?

The property was bought for £200k, will be worth £650-£700k as it will be a 5 bed open plan property in a riverside cotswolds location, so the equity is there at the end, just wondering how to get there, without the hassle of spending a bit, improving, remortgaging, and continuing that cycle till completion of the project.

(by the way this isn't some hair brain scheme, some flash in the pan dream, we have spent 5 years looking, researching and waiting endlessly for the right property).

Appreciate any advice, even if realistically what I am asking isn't possible.

somethingcorporate

A broker should be able to help you given your unusual situation.

chapelconversion

Yes it is an unusual situation, we would have waited for stage payment mortgage but after 3 months of planning and then 3 months of delays with mortgage, we were pushed to buy it on a standard LTV.

What sort of broker? Are there ones to steer clear of, and ones who would be better? We don't 'do' borrowing of this sort, so alien to us, as we don't like carrying debt, but needs must, to get it built.

somethingcorporate

try https://www.unbiased.co.uk to find a local one or ask friends and family for recommendations. If you are looking to borrow against the property then a mortgage broker will likely be who you need or could easily point you in the direction if you need other specialist finance.

Make sure they are (a) independent and (b) whole of market so you are getting impartial advice and access to all products.

chapelconversion

I don't think we can borrow on the property from what my FA said, we bought for £200k put down £30k so only 15% LTV as needed to keep as much cash in the bank...

He did speak to a finance company, but they said not enough in property. Thats just 1 person, speaking to one place mind you, and as I have learnt, keep pressing on, and you'll usually find an alternative option.

I like camping, but think we will be sick of living in a church hall for a year without heating and electrics hehe! Also, we are renting, so the sooner we build, and move the sooner we save on rent.

somethingcorporate

I think you should be able to borrow against future valuations as per a normal self-build mortgage but I am no expert. Hopefully one of the mortgage advisors (we have plenty of great ones here) should be along shortly to provide a bit more advice! Or at least give you a few more options to think about, I don't think all doors are closed to you.

chapelconversion

Thank you so much, it's a big and quick learning curve, self build projects, but we were prepared for it...

We could do some work to the property, re-value, re-mortgage, free up cash, do more work, re-value, re-mortgage, etc. But this is far from ideal, clauses in mortgage mean we can only do it once every 6 months with halifax, it could ruin our credit score as we keep re applying, and it could take us a year or more to reach that point, plus paying rent.

The final LTV is great as the work will put the project at £350k total, and property worth £650k at end. It's just getting there seems to be...hmm weird.

Theres only 15% LTV in church.
Theres 30% LTV in commercial properties, could we put a charge on anything, I am wondering?
Can it be done on loans and CC's alone, say if we only wanted £50k? (I have 10k free limit on CC interest free for another year or so)

jonesMUFCforever

The only point I have to make is that the property may well be worth £650k odd in the end but it still a church which might not be to everyone's taste should you want to sell.