Turning a leasehold property into a freehold
Roma Finance were approached by the introducer John Charcol to see if finance could be provided for one of their customers who had a complex proposition for buying a residential property on which he already owns the freehold.
The customer is a property professional who regularly buys the freehold rights to properties, then looks to buy the property as well to boost the overall value for when they are sold as freehold properties.
In this particular case, he was looking to buy a leasehold property in Solihull for £76,000 which had 83 years remaining on the lease. He already owns the freehold, valued at £43,000, so will be able to increase the value to £119,000, but the plan is also to modernise the property and then sell it fully renovated as a freehold house for approximately £140,000.
After meeting the customer and talking through the case, Roma were able to provide £89,000 over a twelve month term for the initial purchase and to fund the refurbishment. As the house will be sold when refurbished the bridging loan will be paid off with the sale.
Daniel Bowles of John Charcol said: “Samantha and Rachel, thank you so much for your help through this complex and non-standard deal. Your knowledge, guidance and attention to detail is impeccable, by far the smoothest bridge that I have completed in a long time! I will definitely be in touch when the next deal lands on my desk.“
Rachel Pollock, Bridging Specialist at Roma Finance commented: “Despite this being one of the most complicated cases I’ve worked on, the team at Roma were able to work through the issues and found a way to resolve all of the complexities involved in buying a leasehold property and turning it into a freehold house ready for sale. It was a pleasure to work with an experienced property developer who had found a niche in the market and was very successful at turning this kind of property around for a profit.”