We arranged an £800,000 bridging loan for a client buying a property in London to convert into a children’s home. It completed in 4 weeks, so the client could secure the property and start the conversion without waiting for a long-term lender.
At a glance
| Loan type | Bridging loan for a business purchase |
|---|---|
| Purpose | Buy a property to convert into a children’s home |
| Loan size | £800,000 |
| Area | London |
| Term | 12 months |
| Exit | Refinance onto a commercial mortgage once the home is registered and running |
| Time to complete | 4 weeks |
The client
Our client planned to open a children’s home and had found the right property for it. They needed the money in place quickly, or the property would go to another buyer.
The challenge
Most high-street lenders won’t lend on a property that is about to change use. A mortgage lender values it as it stands today, and a children’s home that hasn’t opened yet has no trading history for them to assess.
The client couldn’t wait for the conversion, planning and registration to be finished before buying. By then the property would have been gone.
What we did
We went to specialist bridging lenders who understand change-of-use and care-sector property. We put the case together for them: the purchase price, the conversion plan and a clear exit from day one.
The lender agreed to lend against the property itself. That meant the client could buy now and do the work afterwards, without waiting on a long-term lender.
The outcome
The purchase completed in 4 weeks. The client could press on with the conversion and registration, knowing how the bridging loan would be repaid at the end.
Questions people ask
Can I get a bridging loan to buy a property for a children’s home?
Yes, through specialist lenders. They look at the property’s value, the conversion plan, any planning and registration needed, and how you’ll repay the loan at the end.
How is a bridging loan for a children’s home usually repaid?
Most often by moving onto a commercial mortgage once the home is registered and running, or by selling. The lender will want this exit agreed before they lend.
How McDowell can help
We’re a Northern Ireland based broker with over 30 years’ experience, arranging bridging finance across the UK. If you’re buying a property for a change of use, we’ll find the lenders who understand it and set out the case for you. Find out more about bridging loans, or book a free call below.
Our case studies are anonymised. We leave out anything that could identify a client, their property or their business. Every case is different, and lenders decide each application on its own merits.
Some bridging loans are not regulated by the Financial Conduct Authority. Your property may be repossessed if you do not keep up repayments on a loan secured on it.
McDowell Financial Services Ltd is authorised and regulated by the Financial Conduct Authority, FRN 800988.
This article is general information only and isn't personal advice. Mortgage and protection products depend on your circumstances, so please speak to one of our advisers before making a decision.
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