A three-bed, mid-terraced property in Wales has been converted into a four-bed HMO after a borrower secured funding across two stages with a single lender, avoiding the need to source and pay a separate exit lender for the refurbishment phase.
The case was introduced by Lyndsay Kent of TBK Mortgage Studio. The borrower acquired the property for £85,000, with plans to convert it into an HMO. Because HMO conversions in Wales fall outside permitted development rights, the borrower needed to secure the property while retaining a clear route into refurbishment funding as the planning process progressed.
Hope Capital Property Finance provided an initial purchase bridge to enable the acquisition ahead of the planned conversion. Three months later, with no minimum interest period to satisfy, the borrower refinanced onto a refurbishment facility at 75% LTV and 0.89%, drawing a further £52,000 to fund the conversion works.
Tranches were released the same day that loan support specialist Sophie O’Neill received the monitoring agent’s report. An 18-month term was available, though the borrower completed the works within 12 months.
The lender used its Flip+ proposition to connect the two facilities. Rather than paying a full second facility fee, the borrower paid an uplift fee on the additional refurbishment funding required, alongside a single admin fee covering legals.
A desktop valuation supported the initial purchase facility; a full valuation followed once planning was in place for the refurbishment works to begin. Dual legal representation was used across both facilities, alongside full title insurance.
Continuity across the two stages was maintained by underwriter Stacey Bradwell, who handled both the acquisition and subsequent refurbishment facilities. National account manager Sam Lea and relationship manager Chris Grierson worked closely with Kent throughout, structuring the funding around the property’s valuation.
“From the outset, I wanted to be sure I could make this deal work for my borrower, which meant sourcing a lender that could keep costs down throughout,” said Kent, of TBK Mortgage Studio. “Despite the complexity, Hope Capital Property Finance stayed relentless in finding a solution throughout and made what could have been a very difficult case easy for my borrower.”
“This was a great example of a case where the funding needed to work around the different stages of the borrower’s project,” said Lea, (pictured).
“They needed to secure the property first, while also having a clear route into refurbishment funding when they were ready to progress. Flip+ gave us the flexibility to support both stages, while keeping the borrower with Hope Capital Property Finance throughout. By working closely with Lyndsay and our underwriting team, we were able to structure a solution that reduced the cost and complexity of moving from the initial purchase bridge onto the refurbishment facility.”
“Having underwritten the initial purchase facility, I already had a clear understanding of the case when the borrower was ready to refinance onto the refurbishment facility,” said Bradwell, underwriter at Hope Capital Property Finance.
“That continuity helped make the transition between the two facilities more efficient and is a great example of how closely our sales and underwriting teams work together.”
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