Castle Trust expands criteria and plans longer-term deal launch in September
The lender, which secured a full banking licence in mid-June, has added bridge-to-let and first-time landlord deals to its range. Looking ahead, Castle Trust said it planned to add longer-term products to its offering.
Speaking to Specialist Lending Solutions, managing director Barry Searle (pictured) said: “Now we have a banking licence our cost of funds will be lower which means we can add longer term rates like five and ten year deals to our product range. We’re going to wait though, because right now we want to focus on offering our existing borrowers great deals and expanding the criteria on current products.”
The bank is currently only lending on buy-to-let properties up to a maximum of 75 per cent LTV with a maximum value of £4m. Rate start at 4.99 per cent LTV.
Castle Trust took the decision to manage its risk appetite during lockdown, but as restrictions begin to lift, the lender is re-introducing criteria to meet the demand from brokers.
When the market begins to emerge from the pandemic, Searle wants to grow the bank’s specialist lending volumes and has started making plans for a bigger product launch.
“We’re probably known more for one and two-year deals,” he said. “We did launch a 10-year product at the start of the year, but now we want to launch more five and 1o-year deals to go with it.”
Aside from concentrating on achieving a full banking licence, Searle and his team have been working on a programme of product term extensions for existing borrowers.
He said: “Our first concern in the Covid-19 outbreak was to make sure our existing customers were financially secure. All cases that had a product term due to expire from April to September were automatically given a six month extension on the same rate.”
Searle said he wants to support the bank’s broker partners by being upfront about the cases it will and will not accept.
“I have a lot of sympathy for brokers in the current environment as so many lenders are vague about what they will and won’t lend on throughout this uncertain period,” he added. “We want to be very clear and open about our lending appetite so that brokers know exactly where they stand and can submit an application to Castle Trust in confidence.”
Hope Capital begins remote valuations
The lender said the expansion of its valuation options will suit cases where speed is a priority and can help to make a loan more affordable, as remote valuations are cheaper than physical surveys.
Hope Capital said by taking this decision it is future-proofing itself against similar scenarios whereby valuers are unable to enter properties or there is huge demand on valuers.
These new options for valuations are part of the new Hope Capital Custom Collection which comprises six different products, features and options.
Gary Bailey (pictured), managing director of Hope Capital, said: “It’s fantastic that we’re now able to accept a far broader range of valuation types.
“Often a full valuation can take considerably more time than we may have. Particularly given current circumstances it’s now more important than ever that we’re flexible and can operate swiftly.”
Roma Finance launches bridge-to-term deal
The deal has been developed to offer borrowers longer-term security for property investments.
The maximum loan to value on the term product is 75 per cent, there is no minimum income requirement and top slicing is considered.
The term product is currently only available to those exiting a Roma Finance bridging or development loan.
Roma Finance made the decision to temporarily stop accepting new applications at the end of March in response to the Covid-19 pandemic.
The lender said it used the time to innovate and explore new technologies.
These new initiatives will allow the business to lend while respecting social distancing regulations which protect its customers, brokers, employees and other stakeholders.
It returned to the market 1 May and introduced AVMs and desktop valuations to its processes.
Scott Marshall (pictured), managing director at Roma Finance, said: “The current market is in a constant state of evolution and we are striving to adapt quickly to support brokers and customers and the overall industry. The opportunity for customers to create wealth is still very much present and we have provided a solution to ensure they have security and therefore confidence in their plans.”
MT Finance lowers LTVs and outlines valuation guidelines
The bridging lending will offer up to 65 per cent loan to value (LTV) against residential properties for both first and second charge loans. Previously it offered 70 per cent LTV.
The reasoning behind it is because there is so much uncertainty as to which way the property market is going to go – this safeguards against falls in values and protects the client, as well as the business, in the long run.
For semi-commercial properties it will also lend a maximum of 65 per cent LTV also on first and second charge applications.
The loan to value for commercial properties has been restricted from 65 to 55 per cent LTV for first charge commercial property loans.
The lender said it was working at “sensible” LTV levels to allow transactions to proceed while protecting itself against further changes in the market.
Its is able to provide valuations throughout the UK and has a fully operational solicitors’ panel, it added.
In some cases, it will consider existing valuations from within the last three months alongside an audit from one of its panel valuers.
The lender also added Chris Parr as its business development manager for the Midlands and North of England.
Parr joins from Fiduciam and has over 20 years’ experience working for various banks and specialist lenders, including business development roles at Precise Mortgages and Masthaven.
He will be responsible for supporting brokers in the Midlands and North of England and will work alongside the existing team of BDMs.
Parr said he was looking forward to working with commercial director Gareth Lewis again after their time at Precise.
“I look forward to building on the success of MT Finance in the Midlands and the North of England by delivering the company’s flexible proposition to brokers,” he said.
Gareth Lewis, commercial director (pictured) added: “We are delighted to bring Chris on board. His experience and wealth of knowledge will play a vital role in supporting brokers in these challenging times.”
Apex Bridging promotes Sonia Shortland to MD
Her promotion coincides with the lender’s move to larger premises within the Cornerstone complex in Kegworth and its plans to increase its middle management team.
Shortland (pictured) was formally a director responsible for the day-to-day management of Apex. Her new role will have a greater emphasis on developing and implementing the businesses strategy and plans for the next three years.
Simon Blunt, Apex’s founder, said: “Sonia has been instrumental in establishing Apex Bridging as a growing influence in the bridging sector and we are delighted that in her new role she will be guiding our exciting growth plans for the next three years.”
Shortland added: “The market is becoming more sophisticated and I am delighted to have been asked to steer the business in such challenging times. We have outgrown our current premises and we are currently seeking to fill an operations manager’s position, and other appointments will follow.
“I hope to reward the group board’s confidence in me by extending our distribution to more brokers who share our common sense approach and can trust us to be true to our word.”
MFS completes £17.64m bridging loan
The multi-million-pound sum was used to support a limited liability partnership’s acquisition of a portfolio of properties in central London. Collectively, the property portfolio had a market value of £27,147,000.
Paresh Raja (pictured), CEO of MFS, said: “The final outcome of Brexit may be uncertain, but investors are clearly seeking out new property investment opportunities, particularly here in London. The challenge they face is accessing the finance needed to complete on these purchases. High street banks have become increasingly risk-averse, and this has resulted in more investors turning to specialist lenders to meet their capital demands.
“This bridging loan marks a significant milestone for MFS, demonstrating our expertise in deploying large funds and handling complex cases. By being able to quickly deploy the necessary finance to our borrower, the case shows just why MFS is ideally placed to manage the needs of investors seeking large bridging loans to quickly complete on a property acquisition.”
Raja said the latest loan demonstrated its capabilities in “handling complex cases at the upper end of the property market” and “addressing the specialist finance needs of high-net-worth individuals.”
He added: “Looking to the future, MFS will continue to service this end of the market while at the same time supporting the needs of loans starting from £100,000.”
Roma Finance launches five-year mortgage for property investors
The lender has secured institutional funding for this medium-term mortgage product that landlords can use to acquire buy-to-let property including houses in multiple occupation (HMO) or exit a bridging loan, even if they are not existing customers.
This follows a trial period in April, where the lender offered the mortgage to its existing customers in order to assess demand.
The mortgage has a variable rate from 4.24 per cent per year plus bank base rate, can be offered on an interest-only or repayment basis for loans up to £500,000 with a maximum loan to value (LTV) of 75 per cent.
At the time of taking out the mortgage, the property does not need to be fully let, as the borrower’s other income will be considered.
Use same valuer
For existing Roma customers, the scheme mitigates valuation risk by using the same surveyor who valued the property before the works commenced.
It aims to provide a suitable exit from the bridge and also offers its customers dual representation for the refinance, meaning the process of moving from bridge to term should only take a few days.
Scott Marshall, managing director at Roma Finance (pictured), said: “Extending the reach of this competitively priced mortgage to more types of investment property for purchase, refinance or as an exit strategy for a bridging loan will provide landlords with another route to financing their income-generating property.”
Aspen Bridging and Primus Finance execute dual-purpose £1.8m exit loan
The client was developing a wind and watertight four-bedroom detached house in Windsor Great Park. The property was valued at £1.1m and required £350,000 of works to reach a gross development value of £1.8m.
At the same time, the client wanted a loan facility on another, larger plot of land with development potential nearby.
Aspen’s underwriter assessed the efficiency of the build team and the client’s bigger plan by visiting the site.
The lender agreed a bridging finish and exit loan of £1.2m at an initial rate of 0.61 per cent over 10 months. Aspen issued the illustration within minutes, credit-backed terms inside three hours and the hour after that instructed surveyors and solicitors.
Then Aspen, the broker Primus Finance and the respective solicitors communicated rapidly ensuring quick drawdown of funds.
The commission was paid on the day of completion.
Wind and watertight projects
“We immediately knew that Aspen’s finish and exit product would give our client the best leverage and rate to finish their existing project and fund the next one,” said Primus head of bridging and development Dave Fathers.
“The quick resolution ensured that the works and purchase were not disrupted,” Fathers added.
The client praised Aspen and Primus for delivering “a fast and effective loan at a pivotal point in the scheme. They pulled out all the stops to deliver the speed and gains we required.”
Aspen’s finish and exit product is available up to 80 per cent loan to value with monthly rates from 0.45 per cent, with maximum net loan size for portfolios at £4m and for single properties at £2m.
Roma Finance rolls out open banking solution
Roma Finance is one of the first bridging lenders to utilise open banking.
The open banking solution has helped Roma Finance’s brokers and customers by removing the hassle and delays often associated with the collection of paper statements, helping to ensure prompt, responsible lending decisions are made.
In October 2017, Roma Finance introduced a fast track lending process which resulted in their ability to complete most cases within 15 days and this new initiative is seen as another step in their transformation of the customer journey through advanced technology.
Further technological solutions are in the pipeline to enhance and speed up the customer journey and these will be announced in due course.
Scott Marshall, managing director of Roma Finance (pictured), said: “We are continuing our strategy of investing in technology to ensure Roma Finance is the most technologically advanced lender in our sector.
He added: “It’s our intention to constantly improve the way bridging loans are completed for the benefit of our introducers and their customers.
“We are already completing many cases inside fifteen days and implementing technological solutions such as open banking will help everyone involved and lead to a smarter way to make good and timely lending decisions.”
Fiduciam completes £15m loan to refinance three care homes
Due to a Care Quality Commission (CQC) issue with one of the homes, the borrower had run into trouble with their high street lender that wanted to foreclose on their loan, despite the business still being in profit.
The borrower stood to lose around £8m in equity had the lender progressed a sale through administrators.
The Fiduciam team, working closely with master broker Positive Lending, found a solution and ensured completion of the 24-month bridging loan took place in plenty of time to pay off the first lender.
This allowed the borrower to retain the business they had spent 20 years building and, in doing so, prevented the loss of numerous jobs and much-needed beds for patients, Fiuciam said.
The business has now been able to put another long-term loan in place.
Fiduciam has supported SME’s with over £148m of loans and is currently lending at a rate of £200m per year, with growth in 2018 expected to be up 200% from 2017.
Harry Hodell, senior originator at Fiduciam who managed the case, told Mortgage Solutions the lender is looking to expanding further.
He said: “Completing the amount of work required on this case in a short timeframe shows our process works; we are able to handle complicated cases efficiently and effectively. Matt at Positive Lending was the consummate professional throughout the process and assisted us greatly with the completion of this loan.”
Fiduciam director Johan Groothaert (pictured) said: “This loan, our largest to date, has helped a borrower out of immense financial difficulty. Fiduciam assesses each case on its own merits and delivers bespoke solutions to both intermediaries and borrowers.
“Our strength lies in our institutional funding, which means Fiduciam is able to lend up to 25m in multiple currencies such as euros, sterling and US dollars on property across England, Wales and Ireland, as well as a number of European countries with loans up to three years.
“We continue to develop in all areas of our business with ambitions to continue to expand through innovative lending and problem solving.”
Matt Vincent, specialist lending director at master broker Positive Lending, said: “At Positive, we have a dedicated team specialising in bridging finance who frequently arrange large loans for short term lending.
“This particular client needed almost £15m funding to pay back their original lender but their security situation was complex, which is why we approached Harry at Fiduciam.
“The lender’s can-do attitude and ability to quickly understand the borrower’s situation meant we were able to arrange the monies required and, more importantly, help save the client’s business.”