Can I get a bridge loan with no credit?

AdrianC

prodigalson wrote: »

The property is a property I used to live in as a student, it is a 3 bedroom house on the market for £54,000 exactly I have looked at similiar properties in the area around that range, they all need a significant amount of work done. As a student I was paying £70/week including bills = 3 bedrooms*70*4 weeks/month*10 months = £8400
Now just would require misusing the cost of utilities and agent fee.

...and that's it?

Ooookay.

No maintenance. No SDLT. No finance costs. No bad debts. No income tax. No... <insert long list>

Well, at least you included a small amount for voids. Actually, no - 40wks/year is longer than students are going to be resident anyway.

A £54k three-bed house is either going to be utterly revolting or in a borderline war zone. Or, more likely, both.

Grenage

MEM62 wrote: »

Really? Please let me know how and I'll retire now as I could live off a 10% yield from my pension fund.

Sure; one of my biggest is the Liontrust Special Situation fund.

AdrianC

Grenage wrote: »

Sure; one of my biggest is the Liontrust Special Situation fund.

-0.39% over last 12mo to yesterday.
+6.45% over 12mo to end June.
https://www.liontrust.co.uk/funds/special-situations-fund

prodigalson

AdrianC wrote: »

...and that's it?

Ooookay.

No maintenance. No SDLT. No finance costs. No bad debts. No income tax. No... <insert long list>

Well, at least you included a small amount for voids. Actually, no - 40wks/year is longer than students are going to be resident anyway.

A £54k three-bed house is either going to be utterly revolting or in a borderline war zone. Or, more likely, both.

Maintenance = £600/year, No council tax, Agent fee = 10%, Corporation Tax = 20%, Utilities = £1200/year
After all expenses = £5,088 (9% yield)
All students sign at least a 40 week contract
Property is in ok condition, needs the carpet changed, furniture needs changed, also a lick of paint would make it look nicer and also improve yield.
Properties in this particular area are between £50-70k dependent on condition

Grenage

AdrianC wrote: »

-0.39% over last 12mo to yesterday.
+6.45% over 12mo to end June.
https://www.liontrust.co.uk/funds/special-situations-fund

Yes, but S&S aren't a short-term investment; look at something like 5 or 10 year performance.

sal_III

prodigalson wrote: »

Maintenance = £600/year, No council tax, Agent fee = 10%, Corporation Tax = 20%, Utilities = £1200/year
After all expenses = £5,088 (9% yield)
All students sign at least a 40 week contract
Property is in ok condition, needs the carpet changed, furniture needs changed, also a lick of paint would make it look nicer and also improve yield.
Properties in this particular area are between £50-70k dependent on condition

Why is there no council tax? Also £1200/y utility bill is wildly optimistic for 3bed HMO, electricity+gas alone will cost roughly that much, then you have water and internet.
What about Building/LL insurance?
Dividend tax?

TBagpuss

prodigalson wrote: »

Maintenance = £600/year, No council tax, Agent fee = 10%, Corporation Tax = 20%, Utilities = £1200/year
After all expenses = £5,088 (9% yield)
All students sign at least a 40 week contract
Property is in ok condition, needs the carpet changed, furniture needs changed, also a lick of paint would make it look nicer and also improve yield.
Properties in this particular area are between £50-70k dependent on condition

You aren't allowing for any voids, bad debts etc.

£600 for maintenance seems fairly low, one year where you need to replace the boiler or make any major repairs could wipe that our.

You don't seem to have insurance budgeted.



That said, as others have explained, a Bridging loan is typically a very expensive way of borrowing funds short term - and you would need to show how you were planning to repay it.

What you would need would be a BLT mortgage, and if you already have £28K of debt and no other security, I think you are going to struggle.

You may do better to use the money you have saved to reduce your debt, focus on improving your credit and in the mean time invest elsewhere.

prodigalson

TBagpuss wrote: »

You aren't allowing for any voids, bad debts etc.

£600 for maintenance seems fairly low, one year where you need to replace the boiler or make any major repairs could wipe that our.

You don't seem to have insurance budgeted.



That said, as others have explained, a Bridging loan is typically a very expensive way of borrowing funds short term - and you would need to show how you were planning to repay it.

What you would need would be a BLT mortgage, and if you already have £28K of debt and no other security, I think you are going to struggle.

You may do better to use the money you have saved to reduce your debt, focus on improving your credit and in the mean time invest elsewhere.

Where can I invest my money with a return 2X inflation? I can't invest in stocks and shares beacuse I will become overexposed.

BLT mortgage is out of question as I have some debts which I defaulted on last year.

In terms of maintenance, I have lived in student housing in the past and they barely do maintenance and the owners break the knobs of the heating as well so no one can turn it up in the winter. That's how the keep bills low, and most students barely cook, so little to no gas bill.

A bridging loan would allow me to purchase a property once per year.

My main question is do they look at the deposit more or my credit file?
As I could easily put down 30-40% in a few months

prodigalson

sal_III wrote: »

Why is there no council tax? Also £1200/y utility bill is wildly optimistic for 3bed HMO, electricity+gas alone will cost roughly that much, then you have water and internet.
What about Building/LL insurance?
Dividend tax?

Students by law are not required to pay council tax and neither is the landlord as long as students live there. Have a look at my above post regarding electricity and gas, I have seen the actually bill posted to the property.

Yes, have not factored in LL insurance but will do so.
Dividend tax - included corporate tax, will think of the best way to structure it to minimise tax

Doozergirl

prodigalson wrote: »

In terms of maintenance, I have lived in student housing in the past and they barely do maintenance and the owners break the knobs of the heating as well so no one can turn it up in the winter. That's how the keep bills low, and most students barely cook, so little to no gas bill.

Oh, I get it. You're a troll!

And if you're not a troll, you're a slumlord.

I'd rather be a troll.