- Property Location: London
- Property Value: Circa £11.5 million
- Loan Amount: Circa £5 million
- Interest Rate: Competitive
- Purpose: Refinance existing equity release facility and raise additional capital
Enness was approached by a retired high-net-worth individual who owned a London property valued at approximately £11.5 million. With the majority of the client's wealth tied to the property, they wanted to raise additional capital while the property was being marketed for sale.
The property already had an existing equity release/lifetime mortgage facility secured against it. However, the client was unable to raise any further funds through the existing arrangement. The requirement was therefore twofold: refinance the existing facility and release additional equity on a short-term basis while allowing the property sale to progress.
The main challenge was finding a lender that could accommodate the existing facility, the additional capital requirement and the client's circumstances within a short-term structure. The new financing also needed to provide greater flexibility around the anticipated sale of the property.
Enness identified a suitable short-term financing solution and worked through the underwriting and legal requirements with the lender. Approximately one week before completion, an unexpected issue arose that had the potential to delay the transaction. Given the purpose of the facility, any significant delay could have undermined the benefit of using short-term finance in the first place.
Enness worked with the relevant parties to address the lender's concerns and mitigate the perceived risk. The issue was resolved without pushing back the intended completion, allowing the transaction to proceed within the required timeframe.
Enness successfully secured a circa £5 million facility at a competitive interest rate. The structure enabled the existing equity release/lifetime mortgage to be refinanced while providing the client with the additional capital they required as the property sale progressed.
This case demonstrates how equity release and property equity solutions can form part of a wider financing strategy, particularly where an existing facility no longer provides sufficient flexibility. In situations where capital is required for a defined period while a property is being sold, bridging finance may also provide an alternative short-term structure, subject to the property, exit strategy and lender criteria.
For high-net-worth clients with significant equity in a property who need to refinance an existing facility or release additional capital, Enness can assess the wider circumstances and explore suitable financing structures.
If you are considering releasing equity from a high-value property or need short-term finance while an asset is being sold, speak to a mortgage specialist to discuss your requirements.
Disclaimer:
This case study is for illustrative purposes only and does not constitute financial, legal, tax or investment advice. Finance is subject to status, valuation, underwriting, legal due diligence and lender criteria. Bridging finance is short-term borrowing and may carry higher costs than conventional mortgage finance. Property values can fall as well as rise, and failure to meet repayment obligations could put property used as security at risk.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
