6-Month Development Finance Loan Secured for HMO Refurbishment
CASE STUDIES
May 3, 2023
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6-Month Development Finance Loan Secured for HMO Refurbishment

By
Acuity Finance

Acuity Finance were recently approached to help an experienced landlord with an impressive portfolio fund a refurbishment project to update a recently purchased property.

The landlord, based in Bristol, needed to bring the new addition to their portfolio up to standard in terms of EPC and local authority licencing requirements.

Read on to find out the specifications of the agreement.

 

What were the client’s requirements?

Our client needed a short-term loan of £120,000 to ensure their new property adhered to the strict rules and standards surrounding HMOs, or ‘houses in multiple occupation’.

Since HMO properties have several unrelated tenants living together, there are more stringent rules and regulations that need to be adhered to, and the EPC rating needed to be improved.

The original property had an open market value of £225,000, with the completed project set to increase the value significantly.

How did we help our client?

We provided the client with a six-month term, first-charge development finance loan so that they could complete the refurbishments they needed and get tenants moved in as soon as possible.

The total amount of the loan was £120,000, calculated at a 32% loan to gross development value, provided at 1.1% per month. This cash injection helped the client complete the project swiftly and effectively, raising the value of the completed project to £380,000.

Why Acuity Finance?

At Acuity, we operate using an owner-managed business model and prioritise a close working relationship with our clients. These factors help us source and provide the perfect tailored solution every time.

We offer simple and affordable financial solutions in the form of bridging finance, development finance, and cash-flow or business growth loans to help facilitate your business success.

Looking for a financial solution of your own? Our team are on hand to help break down your options! Drop an email to info@acuityfinance.co.uk or call us on 01905 363999 to speak with one of our team today!