Development loan/finance

[Kefte]

Hi,

We are renovating my third property to sell (fourth if you count our home),which we did using our own savings. We used money from previous sale profits to help put a deposit towards our home. Then a few years ago I inherited a shop and flat, this needs more work than previous and is currently valued at £90,000 but could be worth £150,000-200,000 after work (estate agent valuations). Works cost in region £30,000. There is no finance secured on this property.

Several people I have spoken to have suggested bridging loan, but having explored offers it could cost almost £10,000 in interest and fees. Other options: remortgage our home, but I don't think we have enough LTV wiggle room. Because it's a commercial building, I am struggling to find finance options that are open. Any suggestions?

 

[Longterminvestor]

If you look at the cold hard figures, £40,000 bridging finance (including charges and fees) would increase the property value by between £60,000 and £110,000. Is it really that difficult to see the potential upside?

 

[realdeals]

As long as the potential valuation uplift is far greater than the overall cost bridging finance surely this is a no brainer?

 

[PostBrexitInvestor]

This is the hidden beauty of bridging finance - it all depends on how big the uplift on your property compared to the total cost of the work/finance. Try not to look at bridging finance as expensive - look at the potential uplift.