BFS relaunches developer-focused product with higher LTV

BFS’ ‘Hunters Licence’ is designed for property investors who want to release extra cash to expand their portfolio or finance a refurbishment.

The product works as a property overdraft facility leveraging existing equity. It allows people to take out a revolving credit facility, using their unencumbered property as security to release equity.

It offers a facility up to 70% of the open market value. The client pays the normal setting up fees such as a valuation fee, the arrangement fee and admin fees, and additional interest on the monies when they draw down on the funds.

A first version of the product was initially launched last year. However, the new version offers a higher loan to value (LTV) and has no exit fees.

BFS business development manager Jeanette Jones said: “The development sector is undoubtedly growing, alongside a renewed interest in the property market as we come out of recession and demands grow for homes and commercial buildings.

“We are one of only a handful of companies offering this unique product and believe there will be a strong uptake on the Hunters Licence, unlocking monies for small developers who are keen to drive forward their next scheme whilst funds are tied into current projects or existing portfolios.”

Under the Hunters Licence, clients can make capital repayments at any time with the 1.5% interest amount only payable on the outstanding amount of funds.

The valuation lasts for 12 months at the end of which, clients can pay 1% to renew the facility. However, at this point the property would need to be revalued so clients would have to pay for a new valuation.