Semi-Commercial Re-Bridge Despite Adverse Credit | Hope Capital

Looking at the full picture

When assessing a re-bridge, one of the first things we look at is the exit.

Bridging can provide valuable short-term flexibility, but it needs a clear purpose and a credible route out. We therefore consider the borrower’s experience, the strength of the asset and the proposed exit, rather than focusing on the credit profile alone.

This case, introduced by a broker within Fiducia Commercial Network, is a good example of why that wider view matters.

The challenge

The borrower needed to refinance an existing facility secured against a mixed-use property in Northamptonshire.

The asset comprised a commercial unit, a tenanted two-bedroom flat and a tenanted one-bedroom flat. The commercial unit was due to become vacant during our term, although new tenants had already been confirmed.

There were no works to complete. The borrower simply needed a well-structured re-bridge that would give them enough time to reach the planned refinance exit.

The borrowing entity had some slight adverse credit, but the wider position remained strong. The borrower was experienced, the property provided solid security and the application had been clearly presented by the introducing broker.

Responding to the valuation

A valuation had already been carried out for another lender, so we instructed a readdress to help keep the transaction moving.

The reviewed open market value came back at £425,000, which was a modest reduction from the original figure.

As the borrower had not used the full available leverage, we were able to revise the terms and increase the LTV to 66%. This meant the funding requirement could still be met despite the lower valuation.

The solution

The facility was structured over nine months at 1.02% per month.

As the property was income-producing, interest was serviced monthly rather than retained. This allowed more capital to be released upfront.

The facility delivered a net loan of approximately £272,000. This repaid the existing charge of around £140,000 and released roughly £133,000 towards debt owed to the investor.

The transaction completed using dual legal representation with full title insurance, helping to keep the legal process efficient. A refinance was already lined up as the exit.

Why it worked

The adverse credit and revised valuation both needed to be considered, but neither changed the overall strength of the proposal.

The borrower had experience, the property offered good security and the refinance exit was already in place. The introducing broker also presented the application clearly and remained responsive throughout the process.

Norman Chambers, Executive Relationships Director at Fiducia Commercial Network, said:

“This case shows the value of looking at the full picture. The adverse credit and revised valuation could have caused difficulties, but Hope Capital Property Finance took the time to understand the borrower, the asset and the planned exit. That practical approach, supported by a well-presented application from one of our member brokers, helped deliver the right outcome for the client.”

A re-bridge needs a plan

We will always consider re-bridge enquiries where there is a clear and supportable strategy.

In this case, the security was strong, the structure remained workable and the refinance exit was already in place. That allowed us to deliver the funding the borrower needed despite the challenges along the way.